361 Degrees International Limited Announces Placing of Existing Shares and Subscription of New Shares

Key Highlights of the Transaction

• Placing and Subscription Agreement Signed: On 28 April 2026, 361 Degrees International Limited (the “Company”) entered into a Placing and Subscription Agreement with Ming Rong International Company Limited (the “Vendor”) and UBS AG Hong Kong Branch (the “Placing Agent”).
• Placing of Shares: Up to 100,000,000 existing shares held by the Vendor will be placed to at least six independent placees at a price of HK\$6.18 per share.
• Subscription of New Shares: The Company will issue up to 100,000,000 new shares to the Vendor at the same price of HK\$6.18 per share, subject to the number of shares actually placed.
• Discount to Market Price: The placing price represents a discount of approximately 10.69% to the closing price of HK\$6.920 per share on the last trading day (27 April 2026), and similar discounts on various historical averages.
• Net Proceeds and Use of Funds: The Company expects to raise approximately HK\$610.81 million in net proceeds, to be used primarily for overseas market expansion and general corporate purposes.
• Change in Shareholding Structure: The controlling shareholders’ aggregate stake will decrease from approximately 48.99% to 44.15% after the Placing, but will increase to 46.72% post-Subscription.
• Potential Takeovers Code Implications: The Subscription may trigger a general offer obligation under the Takeovers Code. The Vendor will apply for a waiver.
• Completion Conditions: The Placing and Subscription are subject to several conditions, including regulatory approvals and the granting of a waiver from general offer obligations.

Detailed Terms of the Placing and Subscription

Placing of Existing Shares

• Vendor: Ming Rong International Company Limited, wholly-owned by DHH Capital Limited (ultimately held by TMF (Cayman) Ltd. as trustee of The DHH Trust).
• Number of Shares: Up to 100,000,000 existing shares, representing around 4.84% of the current issued share capital.
• Placing Agent: UBS AG Hong Kong Branch, acting on a best effort basis.
• Placing Price: HK\$6.18 per share, sold free from encumbrances and with all rights attached.
• Placees: At least six independent parties, none of whom will become substantial shareholders as a result of the placing.
• Conditions for Completion: Includes the absence of material adverse changes, no trading suspensions, and satisfactory legal opinions from relevant jurisdictions.
• Termination Rights: The Placing Agent may terminate the agreement under certain adverse conditions.

Subscription of New Shares

• Subscriber: The Vendor (Ming Rong International Company Limited).
• Number of Shares: Up to 100,000,000 new shares, equal to the number of shares placed, representing about 4.61% of the enlarged share capital.
• Price: HK\$6.18 per share, matching the Placing Price.
• General Mandate: The shares will be issued under the general mandate granted at the AGM on 25 April 2025. No further shareholder approval is needed if completed within 14 days.
• Ranking: The new shares will rank pari passu with the existing shares in all respects, including dividends.
• Conditions for Completion: Includes Stock Exchange approval for listing the new shares, Placing completion, and waiver from general offer obligations under Takeovers Code.
• Completion Timeline: To be completed within 14 days of the agreement, or as otherwise agreed in writing.

Shareholding Structure Before and After Transaction

Strategic Rationale and Use of Proceeds

• Strengthening Financial Position: The transaction will raise significant capital, strengthening the Company’s balance sheet and supporting future growth.
• Overseas Expansion: Approximately 80% of the net proceeds (around HK\$488.65 million) is earmarked for overseas market expansion, including setting up new retail stores, e-commerce platforms, acquiring potential targets, marketing, and establishing new subsidiaries.
• General Corporate Purposes: The remaining 20% (around HK\$122.16 million) will be used for general working capital and supporting day-to-day and new overseas operations.
• Potential M&A Activity: While no specific targets have been identified yet, the Company is open to acquisition opportunities that align with its growth strategy.
• Shareholder Value and Dilution: The transaction is expected to broaden the shareholder base and enhance capital flexibility, although it will result in dilution for existing shareholders.

Regulatory and Shareholder Considerations

• Takeovers Code: The Subscription will increase the controlling shareholders’ stake, potentially triggering a general offer obligation. An application for a waiver will be made.
• Minimum Public Float Maintained: At least 25% of the Company’s shares will remain in public hands after completion.
• Listing Application: The Company will apply to the Hong Kong Stock Exchange for the listing and permission to deal in the Subscription Shares.
• No Recent Equity Fundraising: The Company confirms it has not conducted any equity fundraising in the past 12 months.
• Potential Share Price Impact: The placing price at a discount to market and the substantial size of the equity raise are price-sensitive and may result in share price volatility.
• Completion Risk: The transaction is subject to various conditions and may or may not proceed. Shareholders are advised to exercise caution.

Company Overview

361 Degrees International Limited is principally engaged in the research, development, design, manufacturing, and distribution of sports products, including footwear, apparel, and accessories, mainly in the People’s Republic of China.

Conclusion

This significant fundraising exercise through the placing and subscription of shares represents a major strategic move for 361 Degrees International Limited, positioning the Company for overseas expansion and future growth. The transaction, being large and priced at a discount, is a material event that may impact the Company’s share price in the near term. Shareholders and potential investors should monitor subsequent announcements closely and exercise caution when dealing in the Company’s shares.

Disclaimer: This article is a summary of public disclosures by 361 Degrees International Limited and is for informational purposes only. It does not constitute investment advice. Investors should consult their own professional advisers and refer to official filings before making any investment decisions. The proposed transaction is subject to regulatory and contractual conditions and may not ultimately proceed.

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