On 24 November 2016, the Company had entered into an investment agreement with Meicai (previously named Spruce), pursuant to which the Company agreed to subscribe for the newly issued 34,441,169 series D preferred shares in Meicai at a cash consideration of US$25.70 million. Meicai is a holding company incorporated in the Cayman Islands. Its business model shortens the flow of agricultural products at all levels, reducing the cost of raw material procurement, manpower and prices for customers, while providing customers with a wide range of commodities, connecting one end of the supply chain to the fields and one end to urban consumers, satisfying users with a “one-stop shopping” experience. With small and medium-sized food and beverage merchants as the entry point, Meicai focuses on providing restaurants and fruit and vegetable shops with a one-stop, full range of raw material procurement services for food and beverage. Meicai is an independent third party of the Group.

During the Year, Meicai remained growing steadily with high quality in the food and beverage supply chain by continuously optimising its business structure, improving its organisational network and improving synergies, resulting in continuous improvement in financial performance, and achieved sustained profitability. The Company is confident that Meicai will continue its business expansion at a satisfactory growth rate, and become a leader in this industry.