Huafu Fashion's (SHE:002042) unit, Zhejiang Huafu Color Spinning, agreed to receive a compensation of 260.4 million yuan to transfer land to Shangyu District, Shaoxing City, China, according to a Shenzhen Stock Exchange disclosure on Thursday.

The land, including buildings, measures 82,035.86 square meters.

The transaction is expected to raise the Chinese melange yarn manufacturer's net profit by about 180 million yuan, the disclosure added.

The company's shares dropped less than 4% at the close.