Huaihe energy group advances power group acquisition

Huaihe Energy Group announced that its acquisition of 89.30% equity in Huaihe Energy Power Group has been approved by the Shanghai Stock Exchange's M&A and Restructuring Review Committee on November 5, 2025. The transaction involves issuing shares and making cash payments for a total of 11.69bn yuan. The share issuance price is 3.03 yuan per share, based on 80% of the average stock price over the 120 trading days prior to the pricing base date. The acquisition target's assets were valued at 1,309.53m yuan using the asset-based approach. The company expects the acquisition to enhance its asset quality, strengthen operational capabilities, and improve profitability.

The deal also includes performance commitments from Huainan Mining (Group) Co., Ltd., for Guibei Coal Mine's net profit from 2025 to 2027, totaling 129.57m yuan. Additionally, a goodwill impairment compensation arrangement is in place for certain assets valued at 3.98bn yuan. Huaihe Energy Power Group's current in-progress projects, including the Huaibei Xieqiao Power Plant and Huainan Luoshui River Power Plant Phase IV, are advancing as scheduled. The transaction is a related-party transaction and is designed to reduce horizontal competition with the controlling shareholder.

The company utilized both asset-based and income-based valuation methods, with the asset-based approach chosen as the final valuation due to the heavy asset nature of the energy industry. The company confirms that there are no significant changes in the valuation results since the valuation base date of November 30, 2024. The acquisition aligns with national industrial policies and regulatory requirements.