Since its listing in 2007, the Group has been operating only in China and relying on a single source of business, ie that of manufacturing and sale of metallurgical coke and its by-products. The strategy of sole reliance on a single business source which is highly dependent on the steel industry, has over the years caused the Group to operate in challenging business environment and industry landscape and these had accordingly caused the Group’s financial position to be quite volatile. To a large extent, the Group’s financials were subjected to the vagaries of the market at large which dictates the dynamics of the commodity prices, in particular that of metallurgical coke and coking coal, both of which prices cannot be controlled by the Group.

Premised on the above, the Board has developed a sustainable business strategy for the Group moving forward by proposing to venture into other areas of business in an effort to mitigate the risks of solely relying on only one business source which in turn is heavily dependent on a single industry, ie the steel industry. Additionally, this said strategy is envisaged to provide the Group with a diversified income stream, from which it can derive alternative source of revenue and profits in the future to supplement that of its existing metallurgical coke business.

In addition to the above, the Group had all this while been operating only in China and does not have any business presence in Malaysia, despite it being a listed entity in Malaysia. As such, the Board sees this business repositioning strategy as also an opportunity to establish its footprint in Malaysia where it is listed, so that our investors/shareholders can have a better appreciation of the Group.

Towards this objective, the Board is pleased to announce its entry into the tech-enabling business via the acquisition of a 51% stake in the “TouchPoint Group”. The “TouchPoint Group” has two main related businesses, being (i) Industrial Wireless Sensors and Internet of Things; and (ii) Enterprise mobile development applications with the main objective of providing enabling technological solutions to drive intelligent automation and connecting communities through the use of technology via a common platform. A second acquisition is in relation to a more traditional brick and mortar consumer business in the Food and Beverage industry via the acquisition of 100% of Bistromalones (PJ) Sdn Bhd. The acquisition will form part of the anchor merchants for the community platform by the TouchPoint Group and will also be the showcase for how traditional businesses can use technology to enable better access to market and operational efficiencies.

Premised on the above, the Board of Directors of Sino wishes to announce that the Company had on 22 November 2018 entered into two (2) separate term sheets in relation to the following:

(I) proposed acquisiiton of 51% equity interest in Touchpoint International Sdn Bhd and Wavetree LLP ("TouchPoint Group") from Ng Chee Seng, Amiruddin Bin Yahaya and Cindy Wong Ling Ping for a total purchase consideration of RM20.0 millon; and
(II) proposed acquisition of the entire equity interest in Bistromalones (PJ) Sdn Bhd from Chaswood Resources Sdn Bhd for a total purchase consideration of RM8.0 million.

Please refer to the attachments for details of the announcement.

This announcement is dated 22 November 2018.