HONGHUA GROUP (00196) has announced that on October 16, 2025, its subsidiary Honghua Holdings entered into an agreement with Chengdu Jiaozi, and another subsidiary, Sichuan Honghua, signed an agreement with Chengdu Jiaozi on the same day. Under these agreements, Honghua Holdings and Sichuan Honghua have agreed to sell a combined approximately 6.9152% stake in Chengdu Financial Leasing Co., Ltd. for a total consideration of approximately RMB 85.764 million. As of the date of this announcement, the group holds about 6.9152% of the target company’s equity. Upon the completion of this sale, the group will no longer retain any stake in the target company. In line with the group's strategic development plan, the group will continue to optimize its asset structure, focus on its core business, and divest non-core and non-advantageous companies to further enhance resource allocation efficiency. The sale will help the company comply with the State-Owned Assets Supervision and Administration Commission's management requirements regarding central enterprises holding stakes in financial companies, facilitate the orderly exit of non-core assets, reduce risks associated with non-core financial operations, and further optimize the group’s equity structure and capital allocation. By transferring the relevant equity through a public tender process, the group aims to achieve asset realization, increase liquidity, improve its balance sheet, and reduce financial costs, thereby supporting the group in focusing on its primary responsibilities, driving transformation and upgrading, and promoting high-quality development. The board believes that this sale is in the overall interests of the company and all shareholders.