Issue shares and pay cash to purchase assets and raise supporting funds plan

Datang Telecom announced the issue of shares and pay cash to buy assets and raise supporting funds plan, to 1.699 billion yuan to buy Guangzhou to play Entertainment Network Technology Co., Ltd. (hereinafter called "Play Entertainment") 100% equity. The 65% per cent of the transaction is paid in the form of a share offering, and 35% of the price is paid in cash. Three investment institutions, such as Hoi Tong Kaiyuan, which owns the share of "want to play entertainment", will take the opportunity to withdraw gradually.

Specific plan for, Datang Telecom to natural persons Hao, Chen, Ye Yubin, Chenling, Kang Yanjun, Huang and Zhejiang Philip Sail Venture Capital Co., Ltd., Guangzhou World Treasure Investment Partnership, Haitong Kaiyuan Investment Co., Ltd. to 10.65 Yuan/ Share of the price issue of about 103.6948 million shares, about 594.65 million yuan in cash payment, in the cash payment of the price, about 424.75 million yuan to be paid through the collection of supporting funds, about 169.9 million yuan by the company's own funds to pay, raise matching funds issued a reserve price of 9.59 yuan/ Unit。

The company said that the proposed collection of supporting funds for the payment to play entertainment 25% equity of the transaction on the price, is not expected to exceed about 425 million yuan, in accordance with the collection of matching funds issued at the reserve floor, not more than about 44.2909 million shares. This transaction, the need to pay to play entertainment 10% stake in the cash price of about 170 million yuan, the company's own funds to pay.

It is understood that Datang Telecom began to suspend trading since March, the acquisition of game projects took 3 months. The original target was said to have been "infinite" and "37wan" until June. To play entertainment is the domestic leading web game operators and mobile terminal game development and distributors, currently in the entertainment and its subsidiary games operating platform running on more than 70 web games. As of March 31, 2013, the Net worth of entertainment (parent company) book value of about 108 million yuan, value-added rate of about 1472.24%.

To play entertainment 2013-year revenue for the first quarter of 124.2626 million yuan, net profit of 30.7972 million Yuan, 2012 annual revenue of 259.3139 million yuan, net profit of 27.0136 million yuan. Datang Telecom lost 119.5866 million yuan in the first quarter of this year, with a net profit of 168.8966 million yuan in 2012. The company said that the acquisition will be to play the acquisition of entertainment, is conducive to improving the company's profitability and internet business development.

It is noteworthy that November 29, 2012, to play the entertainment shareholders will pass the resolution, agreed that Haitong Kaiyuan total investment of 44.8 million yuan to subscribe to the company's registered capital increase, of which 753,441 yuan into the registered capital, 4,404 65.59 million yuan into the Capital Provident Fund. The company said that because of the rapid development of entertainment business, in order to better promote the company's business development, the company introduced institutional investors Haitong Kaiyuan.

Haitong Kaiyuan Commitment: (1) If the transaction on the date of completion of the day to play entertainment shares less than 12 months, shall not, within 36 months from the date of completion of this transaction, transfer the shares of Datang Telecom subscribed in this transaction, and within 48 months from the date of completion of this transaction, transfer no more than 90% of the number of shares subscribed. , within 60 months from the date of completion of this transaction, the transfer shall not exceed 95% of the number of shares subscribed, and the remaining shares shall be transferable 60 months after the date of completion of this transaction, and (2) if on the date of completion of this transaction the holder of an entertainment interest has expired for 12 months, shall not, within 12 months from the date of completion of this transaction, transfer the shares of Datang Telecom subscribed in this transaction in any form; Within 24 months from the date of completion of this transaction, the transfer does not exceed 30% of the number of shares subscribed, and within 36 months from the date of completion of this transaction, the transfer does not exceed 60% of the number of shares subscribed , within 48 months from the date of completion of this transaction, the transfer shall not exceed 90% of the number of shares subscribed, and the transfer shall not exceed 95% of the shares of this subscription within 60 months from the date of completion of this transaction, and the remaining shares will be transferable after the first 60 months from the date of this transaction.