China Feihe Limited announced that its wholly owned subsidiary, Feihe International (HK) Limited (“Feihe HK”), has signed a loan agreement with Garland Glory Holdings Limited, the company’s controlling shareholder, on 15 October 2026.
Under the agreement, Feihe HK will provide Garland Glory with an unsecured loan facility of up to RMB400.00 million for general working-capital purposes. The facility carries a fixed annual interest rate of 2.73% and a 12-month tenor starting from the actual disbursement date. Early repayment is permitted, with interest calculated on the basis of the number of days the loan is outstanding.
China Feihe stated that the 2.73% rate is at least as favourable as market quotes for comparable one-year renminbi loans offered by independent Hong Kong commercial banks. The loan will be funded entirely from the Group’s internal resources and is expected to yield interest income exceeding both the Group’s funding costs and returns available from fixed deposits of similar tenor.
Because Garland Glory is a controlling shareholder of China Feihe, the transaction is classified as a connected transaction under Chapter 14A of the Hong Kong Listing Rules. The size of the deal triggers reporting and announcement obligations—its highest applicable percentage ratio exceeds 0.1% but is below 5%—while exempting it from circular issuance and independent shareholders’ approval. Chairman Mr. Leng Youbin, who ultimately owns Garland Glory, abstained from the Board vote on the loan approval.
To mitigate credit risk, China Feihe has outlined several control measures: • Ongoing monitoring of repayment and interest by the Group’s finance department, with the right to impose default interest or demand immediate repayment if necessary. • The borrower must provide financial information, including credit reports, upon request. • Garland Glory is obliged to notify the lender immediately of any potential financial instability.
The Board, including all independent non-executive directors, concluded that the loan terms are on normal commercial terms or better, the borrower has adequate repayment capacity, and the transaction aligns with the interests of the company and its shareholders.
Comments