On August 6th, Gelun Hui announced that the Board of Directors approved the transaction agreement between the company and its wholly-owned subsidiary (Shanghai Xingkai), China Cinda and Cinda Capital in a joint venture transaction on August 6th, 2024. The purpose of the joint venture is to establish the Tianjin Xinmei SPV to complete the proposed transaction. The equity transfer consideration of the proposed transaction is RMB 0.98 billion yuan, and the SPV will also provide RMB 1.3 billion yuan of shareholder loan to Yantai RS Macalline to repay its outstanding loans.
After the partnership enterprise transaction is completed, Yantai Red Star will be integrated into the company as a wholly-owned subsidiary, which will further improve the company's asset and liability structure and boost confidence in the capital markets. Therefore, the partnership enterprise transaction is beneficial for the company's stable operation and long-term development.