POWER XINCHEN plans to acquire 53% equity of AVIC Lantian Equipment for 147 million yuan and will resume trading on the afternoon of October 16

According to the announcement from POWER XINCHEN (01148), on October 16, 2025, the buyer Mianyang POWER XINCHEN (the company's indirect wholly-owned subsidiary) entered into a share acquisition agreement with the company (as the subscriber) and the seller Shanxi Lantian Industrial Group and the target company AVIC Lantian Equipment. The buyer agrees to purchase from the seller, and the seller agrees to sell to the buyer the pending rights (53% equity of the target company) for a maximum of approximately RMB 147 million (i.e., equity transfer); and the subscriber agrees to contribute USD 5 million in RMB equivalent to the target company upon completion of the equity transfer (i.e., capital increase). Upon completion of the equity transfer, the subscriber shall contribute USD 5 million (capital increase cost) in RMB equivalent to the target company. After the capital increase, assuming the equity structure of the target company remains unchanged, the buyer will hold approximately 60% equity in the target company. The target company will become a subsidiary of the buyer and an indirect non-wholly-owned subsidiary of the company. It is reported that the main business of the target company includes the manufacturing of automobiles, special equipment, and mining machinery, as well as the production of automotive parts, industrial robots, and intelligent material handling equipment. As of the date of this announcement, the target company is wholly owned by the seller. The group is engaged in the development, manufacturing, and sales of automotive engines and parts for passenger cars and light commercial vehicles in China and is actively seeking ways to expand its core business. The acquisition of the target company aligns with the group's strategy to achieve growth through the integration of synergistic complementary businesses. With the target company's strong track record and reputation in the special vehicles and non-road vehicles industry, the group expects to improve operational integration, diversify its product portfolio, and enhance its market position in the engine and parts industry. The acquisition of the target company will allow the group to expand its product supply capabilities and target a broader market, including the special vehicles and non-road vehicles market. This expansion is expected to bring additional value to shareholders through optimized business resources and sustainable growth. Expand customer base and market share: The existing customer relationships and business network of the target company will immediately broaden the group's customer base. This move will provide opportunities to access new projects and allow the customers of both companies to promote each other's services. Achieve cost savings and operational efficiency: By integrating several administrative, research and development, procurement, and project management functions, the expanded group expects to achieve economies of scale, reduce duplicate costs, and enhance overall operational efficiency. Future business development potential: The combined resources, expertise, and customer networks of the group and the target company are expected to create a solid platform for seeking new business opportunities. The company has applied to the Stock Exchange for the resumption of trading of its shares, effective from 1:00 PM on October 16, 2025 (Thursday)