ZHONGZHENG INTL (00943) announced that on September 29, 2025, the company's indirect wholly-owned subsidiary Dongguan Weihuang Electrical Products Co., Ltd. plans to sell the property (including the land and buildings) to Dongguan Weimai Industrial Investment Co., Ltd. for a total cash consideration of RMB 58 million.

Under the sale agreement, the buyer has agreed to lease back the buildings to the seller for a term of one year commencing from the date of the lease agreement when the buyer transfers the leasing rights of the buildings to the seller, with a monthly rent of RMB 300,000.

On the same date as the sale agreement, the seller and buyer also entered into a loan agreement, whereby the buyer agrees to provide a loan of RMB 15.8 million to the seller for a term of one year from the date the seller draws down the loan.

The property is located at No. 1 Hongye North First Road, Tangxia Town, Dongguan City, Guangdong Province, China, and includes: (i) the land, being the land use rights with a total site area of approximately 21,709 square meters designated for industrial use with a term of 50 years expiring on December 31, 2045; and (ii) the buildings, being a total of eight buildings with an aggregate gross floor area of approximately 36,494.06 square meters constructed on the land, comprising one office building, two factory buildings, four dormitory buildings and one canteen building.

The property is currently used by the group as a factory for its health and household products business.

The board of directors believes that the disposal is in line with the group's strategic objectives. By converting fixed and non-current assets into cash, the group enhances capital efficiency and releases significant financial resources that were previously tied up in property ownership. The strengthened capital base enables the group to reallocate resources to higher-return areas such as proprietary brand development and product and geographical expansion, aligning with the group's priority growth strategy.

Furthermore, the transition from a capital-intensive ownership model to a leasing model through the sale and leaseback arrangement can reduce the group's fixed asset burden and related depreciation expenses, thereby optimizing the overall cost structure. Considering the valuation of the property, the board believes that the disposal provides the group with an excellent opportunity to realize the property's value at a profitable price.