Kam Hing International Holdings (02307) announced that on December 30, 2023, the Group plans to develop vertical integration solutions and expand production into Southeast Asia. On December 30, 2023, the company's wholly-owned subsidiary, Kam Hing Cloth Co., Ltd. (TPT, which operates a production plant specializing in yarn and fabric knitting and dyeing in Vietnam) signed a cooperation agreement on manufacturing and processing subcontracting (subcontract arrangement) for yarn and fabric and knitwear dyeing.
According to the cooperation agreement, the contracting parties will then enter into a formal agreement for a fixed period of at least ten years; TPT promises to provide 200 tons of production capacity per month from the date of the formal agreement until June 2024, and up to 1,000 tons of production capacity per month from March 2025; and Jinxing Textile will provide the machine investment required to meet TPT production. The two parties further agreed that after two years of cooperation according to a formal agreement (or a shorter period of agreement based on the mutual benefits that both parties may obtain), TPT will prioritize equity cooperation with Jinxing Textile, indicating that the Group may acquire part of TPT's shares.