Jiu Rong Hold (ASX: 02358) has announced that its indirectly wholly-owned subsidiary, Zhejiang Jiu Rong Intelligent Technology Co., Ltd., as the seller, entered into an asset transaction contract with Guangzhou Yingfu Technology Co., Ltd., the buyer, on June 25, 2024.

The agreement involves the sale of five smart display panel production lines along with a batch of related auxiliary and testing equipment for a total consideration of RMB 6.05 million, inclusive of tax.

The transaction was conducted through a public listing and bidding process on the online trading platform of Hangzhou Property Exchange Co., Ltd.

The group's digital video business is facing intensified industry competition and economic uncertainty, prompting the implementation of cost-saving measures.

These measures include shutting down internal production facilities and transitioning to a lighter asset operation model.

The divestment of these idle production lines and related auxiliary equipment aligns with this strategic shift.

The board of directors believes the sale will enable the group to realize the residual value of its idle manufacturing assets, reduce maintenance and storage costs, lower liabilities, and alleviate liquidity pressure.