Hebei Haiwei Electronic New Material Technology Co., Ltd. (“Haiwei Electronic”) has disclosed the full details of a previously unannounced major transaction and its subsequent termination, alongside a slate of remedial measures to reinforce Listing Rules compliance.
On 15 December 2025, wholly owned subsidiary Zhejiang Haiwei executed a Procurement Agreement with independent third party Hebei Kunda Machinery Manufacturing Co., Ltd. to purchase five sets of BOPP capacitor-film production line and auxiliary equipment for Haiwei Electronic’s planned Southern China Facility. The contract carried an aggregate consideration of approximately RMB1.00 billion, with individual line-set pricing of about RMB200 million. Payment terms required an 18.5% prepayment, followed by staged instalments and a 5% retention during a 12-month warranty period.
Because the contract’s size exceeded 25% of the applicable percentage ratios under Hong Kong’s Listing Rules, it constituted a major transaction requiring advance announcement and shareholder approval. Haiwei Electronic acknowledged that these procedures were not followed due to a misinterpretation of Rule 14.04(1)(g), which it had initially assumed exempted the deal as revenue-related.
During preparation of the 2025 annual results, management identified the Listing Rules breach and resolved to cancel the agreement. Zhejiang Haiwei and Kunda Machinery formally terminated the contract on 27 March 2026. Of the RMB185.00 million prepayment made on 24 December 2025, Zhejiang Haiwei has recovered RMB176.00 million; the remaining RMB9.00 million—already committed by the supplier for equipment parts—will be credited against a new procurement contract currently under negotiation. Management expects no material impact on the Southern China Facility’s capacity-expansion timetable.
Haiwei Electronic will not seek ex-post shareholder approval, given the agreement’s cancellation, but has outlined a comprehensive compliance overhaul: • Establishment of an independent investigation team led by the audit committee to review the incident and overall internal-control robustness. • Creation of a dedicated transaction-management taskforce, enhanced pre-transaction legal checks, and updated compliance checklists covering PRC and Hong Kong securities regulations. • Mandatory executive confirmation of regulatory consultations before any material transaction. • Ongoing Listing Rules training for directors and senior management.
The company asserts that the corrective steps and prospective New Agreement with Kunda Machinery will preserve the strategic objective of expanding production capacity in Southern China while ensuring strict adherence to regulatory requirements.
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