On November 13, 2023, Alibaba Pictures (01060.HK) announced that its wholly-owned subsidiary Zhenlian Shengshi has entered into Purchase Agreement I with Jiali Culture, Huayi Brothers, and Huayi Entertainment, in which Zhenlian Shengshi agrees to purchase all the equity interest (together with the relevant shareholder loans) in Jiali Culture that is agreed to be sold by Huayi Entertainment, for a total consideration of RMB 0.35 billion.

On July 23, 2024, Alibaba's wholly-owned subsidiary Beijing Alibaba and Dongyang Mela, Beijing Mela, Hainan Mela, and Huayi Brothers entered into Purchase Agreement II, in which Beijing Alibaba agrees to purchase and Huayi Brothers agrees to sell 70% of the equity interest in Dongyang Mela for a total consideration of RMB 0.35 billion.

Jiali Culture is mainly engaged in property holdings. The property includes eight commercial units and twenty-nine parking spaces in the Huayi Brothers headquarters building (a multi-functional office building located at No. A2 Xinyuan South Road, Chaoyang District, Beijing), with a saleable area of 9,871.67 square feet, of which 1,919.11 square feet are currently leased to an independent third party operating a leisure center and the remaining 8,167.61 square feet are currently on the leasing market for office use.

Dongyang Mela is a limited liability company established under Chinese law, with Huayi Brothers and Mr. Feng Xiaogang owning 70% and 30% of the equity interest, respectively. Dongyang Mela is mainly engaged in the production and investment of movies, TV dramas, and web series. After the completion of Purchase Agreement II, Beijing Alibaba and Mr. Feng will respectively own 70% and 30% of Dongyang Mela's equity interest, and Dongyang Mela will become a subsidiary of the company, with its financial performance being incorporated into the group's financial statements.

Beijing Mela is a limited liability company established under Chinese law, and Dongyang Mela owns all of its equity interest. Beijing Mela is mainly engaged in operations such as broadcasting and TV program production, TV drama distribution, and movie distribution.

Hainan Mela is a limited liability company established under Chinese law, and Dongyang Mela owns all of its equity interest. Hainan Mela is mainly engaged in broadcasting and TV program production, as well as TV drama production.

This property is located in the prime area of Chaoyang District in Beijing and is expected to bring stable rental income to the group, thereby strengthening the group's cash flow. In addition, the group regards this property as a long-term investment and hopes to obtain long-term capital returns from it.

Dongyang Mela is mainly engaged in the production and investment of movies, TV dramas, and web series, which is similar to the group's main business. In addition, Mr. Feng Xiaogang, a well-known Chinese film director, is also a shareholder of Dongyang Mela. As part of this acquisition, the group will also enter into Cooperation Agreement II with Mr. Feng, which will specify future cooperation plans and strategic cooperation interests regarding filmmaking. Therefore, this acquisition is in line with the group's strategic and business interests and is expected to further expand the group's core business divisions and expand its presence in the Chinese entertainment industry.