ZHONGZHENG INTL plans to sell Dongguan property for 58 million yuan

According to the news from Zhitong Finance APP, ZHONGZHENG INTL (00943) announced that on September 29, 2025, its indirect wholly-owned subsidiary Dongguan Weihuang Electric Products Co., Ltd. intends to sell the property (including the land and buildings) to Dongguan Weimai Industrial Investment Co., Ltd. for a total cash consideration of RMB 58 million. According to the sale agreement, the buyer agrees to lease back the buildings to the seller, with a lease term of one year starting from the date the buyer transfers the lease rights of the buildings to the seller, with a monthly rent of RMB 300,000. On the same date as the sale agreement, the seller and the buyer also entered into a loan agreement, under which the buyer agrees to provide the seller with a loan of RMB 15.8 million, with a term of one year starting from the date the seller draws down the loan. It is reported that the property is located at No. 1 Hongye North Road, Tangxia Town, Dongguan City, Guangdong Province, China, and includes: (i) the land, which has a total area of approximately 21,709 square meters, designated for industrial use, with a usage right period of 50 years expiring on December 31, 2045; and (ii) the buildings, which consist of a total of eight buildings with a total floor area of approximately 36,494.06 square meters constructed on the land, including one office building, two factories, four dormitory buildings, and one canteen building. The property is currently used by the group as a factory for health and household products business. The board of directors believes that the sale is in line with the group's strategic objectives. By converting fixed and non-current assets into cash, the group enhances capital efficiency and releases significant financial resources that were previously tied up due to property ownership. Strengthening the capital base allows the group to reallocate resources to high-return areas, such as the development of proprietary brands and product and regional expansion, consistent with the group's priority growth strategy. Furthermore, by converting the capital-intensive ownership model into a leasing model through sale and leaseback, the group can reduce its burden of fixed assets and related depreciation expenses, thereby optimizing the overall cost structure. Considering the valuation of the property, the board believes that the sale provides a good opportunity for the group to realize the value of the property at a profitable price