China Communications boosts Seventh Highway Engineering capital, gains $141m

China Communications Construction Company Limited (CCCC) announced a connected transaction involving a capital increase in Seventh Highway Engineering. On August 29, 2025, CIWE, a wholly-owned subsidiary of CCCG (the controlling shareholder of CCCC), agreed to invest 346.3443 million yuan in cash into Seventh Highway Engineering. This capital injection will result in Seventh Highway Engineering ceasing to be a subsidiary of CCCC, with its financial results no longer consolidated into CCCC's statements.

Post-completion, CCCC, through its subsidiary CCCC Second Highway Engineering, will hold a 45% equity interest, while CIWE will hold 55%. The capital increase is expected to yield a gain of 141.8226 million yuan for CCCC, based on the valuation of Seventh Highway Engineering’s equity and its net assets as of December 31, 2024.

The valuation, effective December 31, 2024, utilized an income approach, valuing Seventh Highway Engineering's total shareholders' equity at 283.3726 million yuan. The transaction is expected to enhance Seventh Highway Engineering's competitiveness and facilitate CCCC's participation in water conservancy and hydropower projects.