Uspace Tech (01725) announced that on November 22, 2024, the company's wholly-owned subsidiary, Huizhou Hongshengchang Technology Co., Ltd., intends to sell 100% equity of Huizhou Hengchangsheng Technology Co., Ltd. located in Huizhou Longming Technology Co., Ltd. to 27.1 million yuan.

The main business of the target company is property holding, with its main assets being the target property. The target property is located at No. 11, Qingli Second Road, Shuikou Street, Huicheng District, Huizhou City, Guangdong Province, China. The target property consists of 4 buildings, including a 7-storey production workshop, a 9-storey dormitory, and two single-storey guard rooms, with a total construction area of approximately 45,255 square meters. Among them, approximately 42,500 square meters are used by the group as production facilities for its EMS business, and approximately 2,600 square meters are leased to independent third parties.

The company management believes that the target property is not fully utilized for production. In the long run, investing more financial resources to hold such property is not in the best interest of the company. The sale allows the group to liquidate its property investment, transfer the target company's bank borrowing of approximately 63.9 million yuan to the buyer, and reduce the group's financing cost burden.

After the agreement is completed, the seller will enter into a lease agreement with the buyer to lease about 15,000 square meters of the target property for production and maintain its production activities at the current location for a period of 12 months. The lease will automatically renew for another term upon three months' advance notice to all parties. Some production orders may be transferred to the group's other production plants or independent subcontractors.