Discloseable Transaction - Acquisition of a Vessel

Hong Kong - 2 March 2021

The Board is pleased to announce that, the Purchaser, an approximately 55.69% indirectly owned subsidiary of the Company, entered into the Agreement with the Vendor in respect of the acquisition of the Vessel on 2 March 2021.

The purchase price of the Vessel is US$7,275,000 (approximately HK$56,745,000). The Vessel will be delivered by the Vendor to the Purchaser between 10 March 2021 and 5 April 2021.

Under the Listing Rules, the Acquisition of the Vessel constitutes a discloseable transaction for the Company.

The Acquisition
The Purchaser entered into the Agreement with the Vendor on 2 March 2021 for the acquisition of the Vessel at a purchase price of US$7,275,000 (approximately HK$56,745,000). The Vessel will be delivered by the Vendor to the Purchaser between 10 March 2021 and 5 April 2021.

Information on the Group and the Purchaser
The principal activity of the Company is investment holding and the principal activities of its subsidiaries are international ship chartering and ship owning. The Acquisition The Purchaser is a ship owning company and a wholly-owned subsidiary of Jinhui Shipping, which is in turn an approximately 55.69% owned subsidiary of the Company as at date of this announcement.

The principal activities of the Purchaser are ship owning and chartering.

Vendor
The Vendor is Sea Venture Navigation Inc., a company incorporated in the Republic of Liberia. Its principal activities are ship owning and operating dry bulk carrier for international maritime transportation.

The Vendor is a company wholly-owned by Radefel Shipping Ltd, a company incorporated in the Marshall Islands, which is owned by its ultimate beneficial owner - Mr. Konstantinos Apodiakos. To the best of the Boardís knowledge, information and belief having made all reasonable enquiry, the Vendor, its holding company and its ultimate beneficial owner are third parties independent of the Company and its connected persons (as defined under the Listing Rules).

Vessel
The Vessel is a Supramax of deadweight 53,806 metric tons, built in year 2004. Consideration Under the Agreement, the purchase price for the Vessel is US$7,275,000 (approximately HK$56,745,000) and is payable by the Purchaser as follows:

(1) an initial deposit of US$1,455,000 (approximately HK$11,349,000) will be payable by the Purchaser within three banking days after the date that (i) the signing of the Agreement; and (ii) the confirmation from the escrow agent confirming the account is ready to receive the initial deposit; and

(2) the balance of US$5,820,000 (approximately HK$45,396,000) will be payable by the Purchaser on the delivery of the Vessel which will take place between 10 March 2021 and 5 April 2021.

The purchase price for the Vessel will be payable by cash in United States Dollars.The purchase price of the Vessel was determined by reference to market intelligence the Company has gathered from shipbrokers and its own analysis of recently concluded sale and purchase transactions of vessels of comparable size and year of built in the market, and on the basis of armís length negotiations with the Vendor.

We observe and monitor the sale and purchase market of second hand vessels, including recent market transactions of similar vessels between willing sellers and willing buyers in that prevailing time presuming the vessel free from all registered encumbrances, maritime liens and all debts, free of charter or any contract of employment, for cash payment on normal sale terms at that particular of time. However, as each vessel is never identical, we will take into account the individual specification, maintenance quality and conditions of each individual vessel toconsider its purchase.

The Directors consider that the purchase price is fair and reasonable and the Acquisition of the Vessel is in the interests of the Company and its shareholders as a whole.

Reasons for the Acquisition
The Groupís principal activities are international ship chartering and ship owning. The Vessel is grabs fitted Supramax for the transportation of dry bulk commodities. The Directors and senior management have been reviewing the individual specification, maintenance quality and conditions of the Vessel and consider the purchase price of the Vessel is highly attractive. The Vessel is expected to generate steady stream of income for the Group. The Group currently owns eighteen dry bulk vessels which include two Post-Panamaxes and sixteen grabs fitted Supramaxes.

Total carrying capacity will be increased by 53,806 metric tons to 1,139,362 metric tons after the completion of the acquisition of the Vessel. It is currently expected that the purchase price of the Vessel will be funded by internal resources of the Group.

Listing Rules Implication
As one or more applicable percentage ratios (as defined in the Listing Rules) for the Acquisition of the Vessel exceed 5% but are less than 25%, the Acquisition of the Vessel constitutes a discloseable transaction for the Company under Chapter 14 of the Listing Rules and is subject to the notification to Stock Exchange and publication of announcement requirements under the Listing Rules.

Jinhui Shipping and Transportation Limited