Fujian Holdings Limited (Stock Code: 00181) has announced a discloseable and connected transaction involving an Operating Rights Lease Agreement with Fujian Fulv Qingnian Wenhua Jiaoliu Company Limited (Fujian Fulv). The agreement grants Fujian Holdings the operating rights of Fulaixi Hotel from 1 January 2026 to 31 December 2030, at an annual rental rate of RMB1,500,000. The Fulaixi Hotel, located in Jinluan Bay Scenic Area, commenced operations in 2023 and has recorded revenue of RMB20,820,000, gross profit of RMB15,261,000, and net profit of RMB3,021,000 for the eight months ended 31 August 2025.

Under IFRS 16, Fujian Holdings must recognize a right-of-use asset valued at approximately RMB6,778,000 (equivalent to about HK$7,424,000). As one or more of the applicable percentage ratios exceed 5% but all are below 25%, the arrangement is classified as a discloseable transaction, necessitating notification and announcement procedures under Chapter 14 of the Listing Rules. Because Fujian Fulv is wholly owned by Fujian Tourism Development Group Company (FTD), which in turn holds a 68.70% stake in Fujian Holdings, the lease also constitutes a connected transaction under Chapter 14A of the Listing Rules. However, since the highest percentage ratio is under 25% and total consideration is below HK$10,000,000, the deal is exempt from circular and shareholder approval requirements.

According to the announcement, Fujian Holdings plans to shift its focus from Xiamen Hotel, whose operating period expires on 31 December 2025, to the Fulaixi Hotel. The company expects Fulaixi Hotel’s coastal location and larger facility to bolster its hotel operations. Fujian Fulv, which acquired Fulaixi Hotel in 2021, focuses on hotel management, residential leasing, and similar activities. Fujian Holdings and its subsidiaries engage in hotel operations, property operations in Hong Kong, financial leasing, and piano manufacturing. The company’s Board considers the lease terms fair and suitable for its long-term business interests.