HUABAO INTL (00336) plans to acquire 100% equity of PT. Broad Far Indonesia for RMB 90 million.

HUABAO INTL (00336) announced that on September 25, 2026, Nocton, World Concept, Broad Far, and Broad Far Hong Kong entered into a share transfer agreement. Based on strategic planning and business development needs, Nocton and World Concept (wholly-owned subsidiaries of the Company, as purchasers) agreed to acquire, for a total consideration of RMB 90 million in cash, from Broad Far and Broad Far Hong Kong (as vendors) their aggregate 100% equity interest in the target company, PT. Broad Far Indonesia. Upon completion of this transaction, Nocton and World Concept will hold 99% and 1% of the equity interest in the target company respectively. The target company will become a wholly-owned subsidiary of the Company. Nocton and World Concept will pay the consideration in cash. The target company was incorporated in Indonesia on October 27, 2021, and is principally engaged in the production and sale of heat-not-burn (HNB) cartridge products in Indonesia, and mainly provides OEM/ODM services for HNB cartridge products to customers. Currently, the Group's tobacco-related business mainly focuses on the upstream tobacco raw materials segment, covering categories such as tobacco sheets, flavors, breakable capsules, and other tobacco raw materials; while the target company focuses on the OEM/ODM production and processing of HNB cartridges, positioning it in the midstream of the industry chain. This acquisition will effectively fill the Group's capability gap in the midstream manufacturing segment, promote the formation of a vertically integrated structure of "upstream raw materials + midstream manufacturing," and facilitate synergies between the Group and the target company in areas such as raw material supply, product research and development, production and manufacturing, and market expansion. This acquisition will upgrade the existing business cooperation relationship between the Group and the target company into a wholly-owned integrated management and control system, enabling the Group to fully integrate the target company's mature production capacity, operational experience, and supply chain resources. This will not only help eliminate decision-making friction and coordination costs that may arise under the cooperation model due to differing interested parties, but also ensure full alignment of the Group's strategic direction, providing a more flexible and efficient internal decision-making basis for subsequent resource allocation, production line coordination, and technological iteration, thereby maximizing the release of synergies between both parties. The target company has obtained the relevant qualifications required to engage in the production and sale of HNB cartridges in its place of operations, and has established a well-developed process flow, large-scale production lines, and a stable supply chain system for raw materials and equipment. Its products have also entered multiple national markets. The Directors believe that the acquisition can integrate the target company's production-end resources and market access advantages on the basis of the Group's existing tobacco raw materials business, effectively expanding the coverage of the Group's tobacco-related products and services, further strengthening its one-stop service capabilities for customers outside China, and enhancing its international competitive position.