Sichuan Expressway Plans Up to RMB 12 Billion REITs and RMB 15 Billion Partnership to Acquire 63.75% Stake in

Sichuan Expressway Company Limited announced plans to launch a REITs product on the Shanghai Stock Exchange by September 2026 or a later date. The product aims to invest in and securitize the underlying asset group held by the company's subsidiaries, raising funds for the group's business operations and development.

Under the transaction plan, Sichuan Expressway will establish a partnership with its subsidiary, Chengyu Investment, and the original equity holder, with a registered capital of about RMB 15 billion. Sichuan Expressway and Chengyu Investment will contribute a total of about RMB 3 billion, holding a 20% stake, while the original equity holder will subscribe for about RMB 12 billion, holding an 80% stake. Subsequently, the special plan manager, CITIC Securities, will acquire the original equity holder's partnership interest and contribute RMB 12 billion in cash, becoming a new partner.

After the partnership is established, it will acquire a 63.75% stake in Sichuan Chengdu Second Ring Expressway (the target company) from Sichuan Expressway for about RMB 3.794 billion. Sichuan Expressway stated that after the REITs issuance, the company will have control over the partnership, enjoy variable returns by participating in its activities, and have the ability to influence the amount of returns through its power over the partnership. Therefore, the partnership will be included in the company's consolidated financial statements. The company will hold the target company's equity directly and indirectly through the partnership, and the target company will remain a subsidiary, with its financial results consolidated into the group's accounts.