On behalf of the Board of Directors of the Company, Mercury Securities Sdn Bhd (“Mercury Securities” or the “Principal Adviser”) wishes to announce that the Company proposes to undertake the following:-

(i)         proposed diversification of the business of Sanichi and its subsidiaries (“Sanichi Group” or the “Group”) to include the manufacture, sale and marketing of gloves and other related activities (“Gloves Business”) (“Proposed Diversification”);

(ii)         proposed consolidation of every 10 existing ordinary shares in Sanichi (“Sanichi Shares” or “Shares”) into 1 Share (“Consolidated Share”) (“Proposed Share Consolidation”);

(iii)        proposed renounceable rights issue of up to 1,424,437,980 new Shares (“Rights Shares”) together with up to 712,218,990 free detachable warrants in Sanichi (“Warrants F”) on the basis of 6 Rights Shares together with 3 free Warrants F for every 1 Consolidated Share held by the entitled shareholders of the Company on an entitlement date to be determined (“Entitlement Date”) (“Entitled Shareholders”) (“Proposed Rights Issue with Warrants”);

(iv)        termination of the existing employees’ share options scheme of the Company, which took effect on 7 November 2014 for a period of 5 years and subsequently extended for another 5 years (“Existing ESOS”) (“Proposed Termination of Existing ESOS”); and

(v)        proposed establishment of a new employees’ share options scheme (“New ESOS” or “Scheme”) involving up to 30% of the total number of issued Shares (excluding treasury shares, if any) (“Proposed New ESOS”).

Please refer to the attachment for further details on the above.

This announcement is dated 3 February 2021.