Hongcheng Environmental Protection Technology (02265.HK) announced that its wholly-owned subsidiary Jinjia Environmental Protection in Shandong Province succeeded in bidding for target assets through public bidding, including land use rights for three industrial sites with a total area of about 533300 square meters in Yinhai Chemical Industrial Park, Laizhou City, Shandong Province, and real estate (including properties and warehouses) with a construction area of about 89300 square meters. And other infrastructure and machinery at a cost of about RMB 79.5 million (the same below).
The total costs associated with the transaction, which mainly refer to the related tax and administrative costs, are estimated to be about $6.5 million and $300000 respectively. As a result, the total contribution of the Group is expected to be about $86.3 million. The Group will finance the transaction with net proceeds from the global sale and internal resources.
The company points out that the construction cycle of the new production facility can be shortened and the construction cost-effectiveness can be enhanced through the renovation, maintenance and reconstruction of the existing buildings on the site, and the company considers that the target assets are suitable for the construction of new production facilities and future development.