China Longyuan Power Group Corporation Limited has approved a connected transaction to purchase the 49% equity interest in Guangdong Guoneng Longyuan New Energy Co., Ltd. currently held by controlling shareholder China Energy Investment Corporation (CHN Energy). The acquisition price is fixed at RMB 186.33 million, aligned with an independent valuation that assessed 100% of the target’s equity at RMB 380.26 million as of 31 May 2026.
Upon completion, Guangdong Guoneng Longyuan—already 51% owned and consolidated by China Longyuan—will become a wholly owned subsidiary. The buyer must settle the full consideration within 20 business days after the equity transfer agreement becomes effective; the transaction must be signed no later than 30 November 2026.
Valuation highlights • Method: Income approach (discounted cash flow) reviewed by Baker Tilly Hong Kong Limited. • Key assumptions: Weighted-average cost of capital ranging from 6.22% to 6.80% over the forecast period; risk-free rate 1.75%; market risk premium 5.99%. • Result: Shareholder equity valued at RMB 380.26 million, reflecting a 2.10% uplift to book value.
Financial profile of the target • Total assets: RMB 459.11 million; net assets: RMB 372.43 million (31 May 2026). • Net profit: RMB 24.58 million in 2025 and RMB 49.12 million in 2024. • Operations: Five distributed photovoltaic projects in Guangdong with 24.25 MW of installed capacity.
Regulatory status Because CHN Energy holds approximately 58.72% of China Longyuan’s issued share capital, the deal is classified as a connected transaction under Hong Kong Listing Rules. The applicable percentage ratios fall between 0.1% and 5%, requiring disclosure and annual reporting but not independent shareholder approval.
Strategic rationale Management expects full ownership to streamline capital deployment, mitigate financing constraints and strengthen China Longyuan’s capacity to capture new renewable-energy projects—particularly offshore wind—in Guangdong province.
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