Capital Environment Holdings Limited announced that its indirect wholly-owned subsidiary, Beijing Capital Environment Technology Co., Ltd. (Capital Environment Technology), has won a public tender from Sichuan Qingshi Construction Company Limited for two service contracts under the Qixian domestic waste sanitary-landfill management project.
The agreements, both signed on 6 August 2026, comprise:
1. Waste Screening Project Contract • Value: RMB39.55 million (inclusive of 9% VAT). • Scope: Construction of one 800-tonne-per-day screening line; excavation, sun-drying and processing of about 435,300 tonnes of landfill waste; and disposal of 16,000 m³ ash residues. • Timeline: 660 calendar days. • Payment: Monthly progress payments covering 80% of completed work; post-completion settlement takes cumulative payments to 97%, with 3% retained as a one-year quality warranty. • Performance deposit: 10% of contract value.
2. Leachate Treatment Contract • Estimated value: RMB3.60 million (inclusive of 6% VAT) at a unit price of RMB90/m³, based on treatment of 40,000 m³ of leachate. • Scope: Operation and maintenance of the project’s leachate treatment station, ensuring effluent meets GB16889-2008 standards. • Service period: 22 months. • Payment: Quarterly settlement of 90% of actual influent volume; post-acceptance payment up to 97%, with 3% retained for one year as quality warranty. • Performance deposit: 10% of contract value.
Pricing was determined through a public tender launched on 18 May 2026. Capital Environment Technology calculated project costs at RMB37.18 million and applied an approximate 14.28% cost-plus margin, referencing a comparable 2023 market-based contract that included similar treatment volumes and processes.
Counterparty Sichuan Qingshi is a wholly owned subsidiary of Beijing Capital Eco-Environment Protection Group Co., Ltd. (Capital Eco Group), which holds about 45.11% of Capital Environment’s issued shares. Consequently, Sichuan Qingshi is a connected person under Hong Kong Listing Rules. Aggregating the two contracts, the transaction size represents approximately RMB43.15 million. As the highest applicable percentage ratio exceeds 0.1% but is below 5%, the transactions are classified as connected transactions subject to announcement and reporting requirements only, exempt from circular and independent shareholder approval under Rule 14A.76(2)(a).
Management expects the project to strengthen Capital Environment’s technological capabilities in landfill remediation and deepen its service footprint in Kaifeng’s environmental protection market while aligning with the group’s strategy of transitioning from a capital-driven to a technology-driven business model. Independent non-executive directors concurred that the contract terms are fair, reasonable, on normal commercial terms and in the interests of the company and its shareholders. Non-executive Director Ms. Hao Chunmei abstained from voting due to her material interest in the transactions.