Hongfa Technology's controlling shareholder stake diluted by convertible bonds

Hongfa Technology announced that its controlling shareholder, Hongfa Entrepreneurship Investment Co., Ltd., experienced a passive dilution of its shareholding from 26.94% to 25.94%, triggering the 1% threshold, due to the conversion of "Hongfa Convertible Bonds." This change resulted from an increase in the company's total share capital from 1,481,599,738 shares to 1,539,291,420 shares between November 20 and December 5, 2025. The number of shares held by the controlling shareholder remained unchanged.

In a related announcement, Hongfa Technology confirmed the implementation of an early redemption for "Hongfa Convertible Bonds," which will cease trading on December 9, 2025, and be delisted from the Shanghai Stock Exchange on December 12, 2025. The redemption price is set at yuan 100.2219 per bond. Investors who do not convert their bonds by the final conversion date of December 11, 2025, will face mandatory redemption, potentially incurring significant investment losses given the market price of yuan 130.305 per bond on December 8, 2025.

The company emphasized that this equity change is a passive dilution and will not alter the company's controlling shareholder, actual controller, governance structure, or ongoing operations. Hongfa Technology will continue to monitor any further equity changes resulting from the convertible bond conversions.