Chongqing Machinery & Electric Co., Ltd. (Stock Code: 02722) entered into an Asset Transfer Agreement on 27 November 2025 with Chongqing Zhuoyue Industrial Development Co., Ltd. (Zhuoyue Company), a wholly-owned subsidiary of its controlling shareholder. Under this agreement, Chongqing Machinery & Electric Co., Ltd. (the Transferor) will sell the Target Asset Package of its branch, Shengpu Technology, to Zhuoyue Company (the Transferee) at a consideration of RMB4,885,400.

The Target Asset Package primarily covers the “Chongqing Machinery and Electric Procurement Trading Platform,” an integrated service platform for procurement, payments, contracts, invoicing, and data management. According to the independent valuer’s cost-based assessment, the software platform has yet to be fully completed, and certain functionalities remain under development. The valuer concluded that the cost approach reliably reflects the fair market value of these assets, factoring in replacement cost, newness rate, and other relevant parameters.

As stated in the announcement, the highest applicable percentage ratio under Chapter 14 of the Hong Kong Listing Rules is more than 0.1% but less than 5%. Consequently, this disposal qualifies as a connected transaction subject only to annual review, reporting, and announcement requirements, exempt from circular and independent shareholders’ approval. The board of directors unanimously approved the transaction, with no material interest requiring abstention.

The consideration was determined through arm’s length negotiations and references the asset valuation report as at 30 June 2025. The group anticipates a gain of RMB29,800 upon completion, which is set for 30 November 2025. The transferring party aims to use proceeds to streamline resources, reinforce core competencies in its high-end equipment business segment, and enhance competitiveness. Payment is expected in one instalment within five working days after the agreement takes effect and all completion conditions are fulfilled.