On November 12, Granco announced that on November 12, 2024, the company entered into a subscription agreement with subscriber Mr. Chen Jianwen. According to this agreement, the subscriber has conditionally agreed to subscribe and the company has conditionally agreed to issue and distribute 0.21 billion subscription shares to the subscriber at a subscription price of HK$0.158 per share, to be paid by way of offsetting part of the repayment amount of HK$33.18 million.

On the date of the subscription agreement, the outstanding principal amount and accrued interest under the shareholder loan amounted to approximately HK$74.585 million. After completion, the shareholder loan of HK$33.18 million shall be deemed as repaid.

The subscription shares represent approximately 88.34% of the existing issued share capital as of the announcement date and approximately 46.90% of the expanded issued share capital immediately after completion.

Considering the current financial performance and condition of the group, the company believes that capitalizing the loan will partially repay the shareholder loan (including accrued interest) without the need to obtain additional bank borrowings or incur additional financing costs or utilize existing financial resources of the group, which can be retained for general working capital and business development, while improving the debt level and strengthening the group's financial position.

Although the subscriber is confident in the future business performance of the group, expressing intention to capitalize the shareholder loan and increase its equity investment in the company, the company believes that the subscriber's subscription as an executive director and controlling shareholder reflects confidence in the long-term and sustainable growth of the group, and the subscriber's continued support will benefit the group's long-term business development.