Ruyan (HKG:0329) yet to reach deal with Philip Morris

Ruyan Group (HKG:0329) said that an agreement between the Company and Philip Morris International Management S.A. could not be
reached on matters relating to the co-operation between them on its "electronic cigarettes" by the end of the first and exclusive
phase of negotiations.

Ruyan said it will continue to negotiate with Philip Morris on the proposed transaction and the company will commence discussions and negotiations on
similar collaborations with other tobacco manufacturers.