Shanghai Mechanical & Electrical Industry replied to the inquiry letter issued by the exchange. The content shows that the company believes that the acquisition of Shanghai Jiyao Mingyu Mechanical Technology Co., Ltd. is pricing fair, reasonable, and in compliance with relevant laws and regulations, and there is no situation that harms the interests of small and medium-sized shareholders of listed companies. Previously, Shanghai Mechanical & Electrical Industry's acquisition of Shanghai Jiyao (this transaction constitutes a related party transaction) for more than 5 billion yuan, and the payment method is all paid at one time with the company's own funds, and no performance commitments and compensation have attracted market attention, and the exchange has therefore issued an inquiry letter. In this reply letter, Shanghai Mechanical & Electrical Industry mentioned that the trading party has made a commitment to the performance of Shanghai Jiyao.