Shanghai Dazhong Public Utilities (Group) Co., Ltd. (Stock Code: 1635) announced details of a continuing connected transaction involving its subsidiary, Shanghai Dazhong Run Logistics Delivery Co., Ltd. (“Dazhong Logistics Delivery”), and Shanghai Qingpu Gas Co., Ltd. (“Shanghai Qingpu Gas”). Under a newly signed LPG Cylinder User Delivery and Drayage Transportation Service Contract dated February 11, 2026, Dazhong Logistics Delivery will provide transportation, delivery, loading, safety inspection, and drayage services for Shanghai Qingpu Gas’s LPG cylinders in Qingpu District, Shanghai. The contract is effective from January 1, 2026, to December 31, 2026.
According to the announcement, Shanghai Qingpu Gas has entrusted Dazhong Logistics Delivery to uniformly deliver its LPG cylinders by automobiles and will pay service fees based on per-cylinder unit prices and transportation volumes. The annual transaction amount is capped at RMB18 million. Payment will be settled monthly for delivery services and quarterly for drayage transportation, with invoices issued upon confirmation of transportation volumes. Shanghai Qingpu Gas will then remit payment within 30 business days.
Shanghai Qingpu Gas is 51% owned by Shanghai Gas Co., Ltd., which is a substantial shareholder of Shanghai Dazhong Gas, a subsidiary of Shanghai Dazhong Public Utilities. As such, Shanghai Qingpu Gas qualifies as a connected person under the Listing Rules. Given that the highest applicable percentage ratio for this transaction exceeds 0.1% but is below 5%, the announcement indicates the arrangement is subject to reporting, annual review, and announcement obligations but exempt from independent shareholders’ approval.
Management cites Dazhong Logistics Delivery’s familiarity with Shanghai Qingpu Gas’s operational needs and the company’s robust transportation experience and professional qualifications as reasons for executing the contract. The board concludes that the transaction is on normal commercial terms, fair and reasonable, and in the best interests of the company and its shareholders.