Huafa Industrial shifts funds to Shaoxing project, reduces subsidiary capital

Huafa Industrial has reallocated 837,721,106.37 yuan in raised funds, originally for the Zhengzhou Huafa Fengjing Garden and Nanjing Yanzi projects, to the Shaoxing Financial Vitality City project. This adjustment, approved by the board and audit committee, reflects a decrease in projected capital needs for the initial two projects, which are nearing completion, and greater demand for the Shaoxing project. The reallocation includes 11,358,910.18 yuan from interest income on the raised funds.

The company's board also approved the temporary use of 700,000,000 yuan in idle raised funds to supplement working capital for core business activities, with a repayment commitment within 12 months. Additionally, Huafa Industrial's wholly-owned subsidiary, Shanghai Huamin Zhuanhong Real Estate Development Co., will undergo a capital reduction of 2,400,000,000 yuan, decreasing its registered capital from 3,000,000,000 yuan to 600,000,000 yuan, without impacting its operational efficiency or the company's consolidated financial statements.

These changes follow the company's 5,124,450,000 yuan equity issuance in October 2023, with net proceeds of 5,042,372,818.01 yuan. The board has also approved new storage and supervision agreements for the raised funds and is set to appoint a new accounting firm, pending shareholder approval.