Hualu-Hengsheng (Jingzhou) Co., Ltd. announced that it will receive CNY 2,000,000,000 in an equity round of funding on October 26, 2022. The transaction will include participation from returning investors Shandong Hualu-Hengsheng Chemical Co., Ltd. for CNY 1,400,000,000 for 70% stakes, Hualu Holdings Co.,ltd. for CNY 400,000,000 for 20% stakes and Hualu Investment Development Co., Ltd. for CNY 200,000,000 for 10% stakes. The shareholding ratio remained unchanged.

After the capital increase is completed, the registered capital of company will be changed from CNY 3,000,000,000 to CNY 5,000,000,000. The investors will pay the capital in the same proportion in installments. The transaction has been approved by board of directors of Shandong Hualu-Hengsheng Chemical Co., Ltd. in its seventh meeting of the eighth session of the board of directors.

According to the relevant provisions of the Shanghai Stock Exchange Listing Rules , this connected transaction does not need to be submitted to the company's general meeting of shareholders for consideration and approval. This capital increase constitutes a connected transaction but does not constitute a major asset reorganization as stipulated in the "Administrative Measures for Major Asset Restructuring of Listed Companies. All parties to the capital increase in this connected transaction will make capital contributions in cash and will increase their capital in proportion to the original capital contribution.