GAC Group (02238) has announced that on March 31, 2026, its wholly-owned subsidiary, U-Power Energy, entered into an agreement with Guangzhou Automobile Industry Group to sell its 12% equity interest in Xinjiang Kunlun Landau Mining Development Co., Ltd. for approximately 1.92 billion yuan. Upon completion of the transaction, Guangzhou Automobile Industry Group will become a shareholder of the target company, directly holding a 12% stake, while GAC Group's indirect ownership in the target company will decrease from 20% to 8%.

In response to significant shifts in the automotive industry's competitive landscape and intense market competition, the company intends to optimize its asset structure through this divestment. The move aims to monetize non-core assets, recover capital, and further focus on its core automobile manufacturing business. By concentrating resources on enhancing core competitiveness, the company seeks to lay a foundation for future business growth and operational improvements.

The sale represents an active optimization and integration of the company's existing equity investments, aligned with its development strategy and industry conditions. It is designed to improve the efficiency of resource and capital utilization. In the short term, the transaction is expected to generate gains from the equity transfer, providing financial support for subsequent development. In the long term, the company will continue to hold a stake in the target company through its subsidiary, enabling it to benefit from the target’s future growth, enhance investment returns, and mitigate investment risks.

The target company’s principal business activities include mineral washing and processing, metal ore sales, mining machinery sales, chemical product sales (excluding licensed chemicals), self-funded investment activities, non-coal mineral resource extraction, mineral resource exploration, accommodation services, and power supply.