Yunnan Jinggu Forestry sells wood company stake, cuts losses

Yunnan Jinggu Forestry Co., Ltd. will divest its 51% stake in Tangxian Huiyin Wood Co., Ltd. for 133.366 million yuan to Grand Fortune Investment Co., Ltd. The transaction, based on an asset appraisal of 39.3069 million yuan for Huiyin Wood's full equity, aims to mitigate financial risks and improve the company's asset-liability ratio. Huiyin Wood, a manufacturer of particleboard and fiberboard, has faced substantial losses, with a net loss of 259.5038 million yuan for January-July 2025, and its operations have ceased due to legal disputes and asset freezes.

Grand Fortune Investment has committed to repay Huiyin Wood's outstanding loans and interest to Yunnan Jinggu Forestry by the transaction's closing date, totaling 62.8425 million yuan. This will prevent potential capital occupation risks for the listed company. The deal has received preliminary board approval and is pending shareholder approval. Huiyin Wood's minority shareholders have waived their pre-emptive rights, and the transaction is expected to enhance Yunnan Jinggu Forestry’s financial health.