BAIC MOTOR (01958.HK): BAIC Investment Exits Beijing Hyundai Auto Finance for RMB 2.2077bn; Net Gain of About RMB 14.23mn Expected

NewTimeSpace News: On 21 October 2026 (after trading hours), BAIC Motor Corporation Limited (the "Company") announced that Beijing Hyundai Auto Finance, BAIC Investment, Beijing Hyundai, Hyundai Finance and Hyundai Motor entered into a capital reduction agreement, under which the parties agreed: first, that BAIC Investment will exit its entire equity interest in Beijing Hyundai Auto Finance by reducing its registered capital in Beijing Hyundai Auto Finance (in an amount equivalent to BAIC Investment's capital contribution), representing 33% of the total registered capital of Beijing Hyundai Auto Finance, for a consideration of RMB 2,207.70 million payable by Beijing Hyundai Auto Finance to BAIC Investment; and second, that Beijing Hyundai will exit its entire equity interest in Beijing Hyundai Auto Finance by reducing its registered capital (in an amount equivalent to Beijing Hyundai's capital contribution), representing 14%, for a consideration of RMB 936.60 million payable by Beijing Hyundai Auto Finance to Beijing Hyundai.

The announcement disclosed that, upon completion of the capital reduction, the registered capital of Beijing Hyundai Auto Finance will decrease from RMB 4,000 million to RMB 2,120 million, with the reductions amounting to RMB 1,320 million, being BAIC Investment's capital contribution, and RMB 560 million, being Beijing Hyundai's capital contribution. Immediately before the capital reduction, Beijing Hyundai Auto Finance was an associate of the Company, held as to approximately 46% by Hyundai Finance, an independent third party, approximately 33% by BAIC Investment, a non-wholly-owned subsidiary of the Company, approximately 14% by Beijing Hyundai (a sino-foreign joint venture invested in by BAIC Investment and Hyundai Motor, each contributing 50% of its registered capital), and approximately 7% by Hyundai Motor, an independent third party; upon completion, neither BAIC Investment nor Beijing Hyundai will remain a shareholder of Beijing Hyundai Auto Finance. The considerations were determined through arm's length negotiations among the parties on a base of RMB 6,690.00 million, which is not lower than the value of the entire equity interest of RMB 6,689.60 million appraised by the independent valuer using the asset-based approach as at the valuation reference date (30 June 2026), with each party receiving an amount calculated by reference to its capital contribution ratio.

The Company stated that, as one or more of the applicable percentage ratios for the exit exceed 25% but are below 75%, the exit constitutes a major transaction of the Company and is subject to the reporting, announcement, circular and shareholders' approval requirements under Chapter 14 of the Listing Rules; the Company will convene an extraordinary general meeting to obtain shareholders' approval, and a circular containing further details of the capital reduction agreement and the exit and the notice of the extraordinary general meeting will be despatched to shareholders within 15 business days after publication of the announcement. Beijing Hyundai Auto Finance recorded revenue of RMB 528.57 million and RMB 357.99 million for 2024 and 2025 respectively, with net profit after tax of RMB 78.73 million and RMB 44.48 million; for the first half of 2026, revenue was RMB 142.18 million and it recorded losses before and after tax of RMB 96.88 million and RMB 122.82 million respectively. As at 30 June 2026, its audited total assets had a carrying amount of approximately RMB 7,422.02 million and the carrying amount of owners' equity attributable to the parent was approximately RMB 6,653.69 million. The Company expects to recognise an unaudited net gain on the exit and to record net profit after tax attributable to owners of the Company of approximately RMB 14.23 million; upon completion the Group will hold no interest in Beijing Hyundai Auto Finance and its financial results and net assets will no longer be accounted for under the equity method. The Company said the exit aims to further optimise the Group's asset structure and improve capital efficiency and overall return on assets, with the recovered funds to be used to support the Group's business development.