1. INTRODUCTION

The Board of Directors of ACO ("Board") wishes to announce that its wholly-owned subsidiary, Actgen, had on 19 May 2020 entered into a distribution agreement with Sylvania Malaysia ("Distribution Agreement") to promote and sell the Sylvania’s light-emitting diode ("LED") lighting products within Malaysia ("Products").

2. ​INFORMATION ON SYLVANIA MALAYSIA

Sylvania Malaysia was incorporated in Malaysia as a private limited company under the Companies Act 2016 on 3 February 2020. Sylvania Malaysia is a manufacturer and seller of lighting products (including lamps). “Sylvania” is the leading brand of the Feilo Sylvania Group with headquarters in Budapest, Hungary, as well as innovation and solution centres in 25 countries worldwide. The Feilo Sylvania Group is ultimately owned by Shanghai Feilo Acoustics Co., Ltd, which was founded in 1984 and subsequently listed on the Shanghai Stock Exchange in 2012 and is China’s first joint-stock company (SH 600651).

Built on over a century’s expertise in lamps and luminaires, Sylvania is a leading brand provider of consumer, professional and architectural lighting solutions. It designs, manufactures and installs lighting solutions. Its mission is to ‘Light your world’ with thousands of products & services and an expertise in energy-efficient, LED and Internet of Things connected solutions which can save money in the long term. Its products and solutions are used in a wide range of applications, including Logistics & Industry, Office, Retail, Hospitality, Museums & Galleries, Education and Residential & Consumer.

3. SALIENT TERMS OF THE DISTRIBUTION AGREEMENT

3.1 Appointment

Sylvania Malaysia appoints ACO as its non-exclusive distributor to distribute the Products in Malaysia.

3.2 Duration and Termination

The Distribution Agreement shall come into effect on 1 June 2020 ("Commencement Date") and, subject to certain clauses in the Distribution Agreement, shall be in force from the aforesaid Commencement Date to 31 December 2020, or terminated by either party giving not less than 3 months’ prior notice in writing.

4. RATIONALE

As a distributor of electrical products and accessories and part of ACO’s expansion plan, the Company is constantly sourcing for quality electrical products and accessories and to expand its portfolio of third party brands. The appointment of ACO as the distributor for Sylvania will enable ACO to broaden its range of products offerings to its customers thus providing customer convenience as well as increase its consumer base.

5. FINANCIAL EFFECTS

5.1 Share capital and substantial shareholders' shareholdings

The execution of the Distribution Agreement is not expected to have any material effect on the net assets, gearing, share capital and substantial shareholders’ shareholdings of the Company for the financial year ending 28 February 2021.

5.2 Earnings and Earnings per Share ("EPS")

Barring any unforeseen circumstances, the Board envisages the Distribution Agreement to contribute positively to the earnings and EPS of the Company in the future.

6. RISK FACTORS

The Company does not expect any material risk arising from the appointment of ACO as the distributor for Sylvania Malaysia pursuant to the Distribution Agreement other than the normal operational risk associated with the Distribution Agreement, which the Company would take appropriate measures to mitigate it.

7. APPROVALS REQUIRED

The Distribution Agreement is not subject to the approval of the Company’s shareholders and/or any regulatory authorities.

8. INTERESTS OF DIRECTORS, MAJOR SHAREHOLDERS AND/OR PERSONS CONNECTED TO THEM

None of the directors, major shareholders and/or persons connected to them has any interest, whether direct or indirect, in the Distribution Agreement.

9. STATEMENT OF DIRECTORS

The Board, having taken into consideration all aspects of the Distribution Agreement, is of the opinion that the Distribution Agreement is in the best interests of the Company.

10. DOCUMENT FOR INSPECTION

The Distribution Agreement will be made available for inspection at the registered office of the Company at Unit 30-01, Level 30, Tower A, Vertical Business Suite, Avenue 3, Bangsar South, No. 8 Jalan Kerinchi, 59200 Kuala Lumpur, Wilayah Persekutuan Kuala Lumpur, during normal business hours (except public holidays) for a period of three (3) months from the date of this announcement.

This announcement is dated 19 May 2020.