CHINA ENV RES (01130) plans to acquire 90% equity of Sichuan Yuanlaishun Renewable Resources Co., Ltd. for 9 million yuan.

CHINA ENV RES (01130) announced that a memorandum of understanding regarding the potential cooperation on the development of rare earth projects in the People's Republic of China and other related business opportunities was terminated by the company and Goldwin Century on December 12, 2025 (after trading hours). The parties to the agreement have mutually agreed to terminate the memorandum of understanding, with immediate effect. The memorandum of understanding was intended to provide a framework for the company to conduct due diligence on Sichuan Yuan Lai Shun and its business operations, and explore the feasibility of potential cooperation. Following further commercial negotiations, it was determined that the direct acquisition of the main operating subsidiary of Sichuan Yuan Lai Shun, Sichuan Yuan Lai Shun Regenerative Resources Limited (the target company), would be more aligned with the strategic direction of the company's existing metal recycling business (the company has been actively exploring similar opportunities outside of Hong Kong after divesting its metal recycling business in Hong Kong). This move is more advantageous for the group than the previous planned cooperation. The acquisition will enable the group to directly control and fully integrate the business of the target company, thereby better leveraging the synergies and growth opportunities in the rare earth materials market. As such, the parties have agreed to terminate the memorandum of understanding that has served its initial purpose, and enter into a definitive agreement for the acquisition. On December 12, 2025, the company, through its wholly-owned subsidiary, entered into a share transfer agreement with Sichuan Yuan Lai Shun, intending to acquire 90% of the equity interest in the target company for 9 million RMB. The target company is mainly engaged in the recycling of renewable and recyclable resources in China (focusing on producing reusable copper, aluminum, rubber, and rare earth permanent magnet components for new energy motorcycles) and other related business opportunities. Prior to the completion of the acquisition, the target company is wholly owned by Sichuan Yuan Lai Shun. The directors believe that the acquisition represents a strategic opportunity to enter the high-quality and specialized field of rare earth materials recycling (an industry with significant global prospects and development potential) to strengthen and expand the group's metal recycling business. The acquisition allows the group to enter the rare earth business, acquire quality rare earth magnetic materials, and stand out in competitive markets such as electric vehicles and green technology. The directors believe that the acquisition enables the group to meet the growing demand for advanced materials and innovative solutions in its diversified business segments (including metal recycling and green market applications).