Zhonghua Geotechnical boosts guarantees for controlling shareholder, secures new loan

China Zhonghua Geotechnical Engineering Group (SZSE:002542) will provide additional counter-guarantee assets to its controlling shareholder, Chengdu Xingcheng Investment Group Co., Ltd., for a 2 billion yuan guarantee facility. This includes pledging 100% equity in Beijing Changdao Municipal Engineering Group Co., Ltd., previously pledged in 2023, along with other assets. The company will also pay a guarantee fee not exceeding 1.0% per annum on the actual guaranteed amount.

Separately, Zhonghua Geotechnical has applied for an additional 800 million yuan loan from Chengdu Xingcheng Group to meet debt repayment and operational needs. This loan, valid for one year and revolving, will carry an average annual interest rate not exceeding the 1-year LPR plus 150BP. This new loan is also secured by various assets including equity stakes in subsidiaries and properties.

Both transactions constitute related-party transactions and were approved by the board of directors, with related parties abstaining from voting. These resolutions await approval at the fourth extraordinary general meeting scheduled for October 9, 2025. As of the disclosure date, cumulative related-party transactions with Chengdu Xingcheng Group in 2025 totaled 97,044.88 million yuan.