Company: DDC
Filing Date: 2025-01-28
Form Type: 20-F
Source: 0001213900-25-007160
Chunk: 136

Company: DDC Enterprise Ltd
Filing Date: 2025-01-28
Form: 20-F
Item: Item 5
Chunk 136
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 commerce platforms to drive higher sales for
its own branded product business.

On June 17, 2022, SH DDC and
Mr. Zheng Dongfang set up QZ DDC to transfer the YJW Target Assets and Keke Target Assets. On the same day, SH DDC has obtained control
over the Target Assets, and the results were consolidated into the Group. Whereas before the completion of the transferring of the target
assets, SH DDC would have the right to receive 60% of the net profits generated by the target business and participate in the management.

On April 1, 2023, SH DDC and
the Company entered into a purchase agreement with Mr. Zhang Yi, Ms. Shen Zhouzhou and Ms. Chen Di, to acquire 51% equity interest of
Shanghai Yuli Development Limited (“ Yuli”) for cash of RMB4.1 million. In addition, the Company will issue share options of
DDC equivalent to a value of approximately RMB24.5 million. The number of share options is subject to adjustments, based on certain performance
targets to be achieved during the performance period. Yuli is principally engaged in sales of RTC and RTE product giftboxes. The acquisition
of Yuli is expected to give the Company access to a wide range of new offline enterprise customers. The acquisition of 51% equity interest
of Yuli was completed in the third quarter of 2023.

On April 30, 2023, SH DDC
entered into a purchase agreement with four entities controlled by Mr. Liao Xuefeng, (together as “the Sellers”) to acquire
100% interest in four online stores on Pinduoduo platform (“collectively referred to as PDD Stores”), for cash of approximately
RMB402,755, subject to adjustments during the subsequent performance periods. PDD Stores are principally engaged in online sales of self-heated
hotpots. This acquisition enables the Company to expand its custom traffic through a wide range of online channels and broadens the source
of income of the Company. As of 30 June 2023, the Company has completed the transaction. As of August 19, 2023, the Company terminated
the purchase agreement signed on April 30, 2023, to acquire 100% interest in PDD Stores. As a result of the termination of purchase agreement
with the PDD Stores, we expect to be able to focus our capital and efforts