Hengli Refining & Chemicals, a wholly-owned subsidiary of Hengli Petrochemical, will merge with Hengli Chemicals, which is also a wholly-owned subsidiary of the company

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On the evening of August 15, Hengli Petrochemical Co., Ltd. (hereinafter referred to as “Hengli Petrochemical”) issued a announcement regarding the merger and absorption of its wholly-owned subsidiaries. The announcement states that Hengli Refining & Chemicals, a wholly-owned subsidiary of Hengli Petrochemical, will merge with Hengli Chemicals, which is also a wholly-owned subsidiary of the company. Upon completion of the absorption merger, Hengli Refining and Chemicals will continue to operate, while Hengli Chemicals will be deregistered in accordance with the law. All of Hengli Chemicals’ assets, claims, debts, and all other rights and obligations shall be inherited by Hengli Refining and Chemicals in accordance with the law. It is agreed to authorize the management of Hengli Petrochemical, as well as the management of Hengli Refining and Chemicals, to handle the relevant matters related to this merger, and to carry out any other procedures required by laws, regulations, or supervisory requirements. This merger does not constitute a related-party transaction, nor does it constitute a major asset restructuring as defined in the Measures for the Administration of Major Asset Restructurings of Listed Companies. In accordance with the relevant provisions of the Shanghai Stock Exchange’s Rules for Stock Listing and the Company’s Articles of Association, this merger does not require approval by the company’s shareholders’ meeting. Basic information of the acquirer: Hengli Petrochemical (Dalian) Refining & Chemical Co., Ltd. (Hengli Refining & Chemical), established on March 10, 2014, with its registered address at No. 298 Changsong Road, Changxing Island Economic Zone, Dalian, Liaoning Province. Its registered capital is 1,759,633 million RMB, and it is a wholly-owned subsidiary of Hengli Petrochemical. As of December 31, 2024, Hengli Refining & Chemical’s total assets amounted to 1,134,716.742 million yuan, its total liabilities were 802,283.561 million yuan, and its net assets were 332,433.181 million yuan ； In 2024, the company achieved operating revenue of 2,269,691.918 million yuan, with a net profit attributable to the parent company amounting to 198,181.39 million yuan. Basic information of the acquired party: Hengli Petrochemical (Dalian) Chemical Co., Ltd. (Hengli Chemical) was established on December 13, 2016. Its registered address is No. 298, Changsong Road, Changxing Island Economic Zone, Dalian, Liaoning Province. The registered capital is 457,495 million RMB, and it is a wholly-owned subsidiary of Hengli Petrochemical. Key financial figures: As of December 31, 2024, Hengli Chemical’s total assets amounted to 7,057,817.33 million yuan, its total liabilities were 6,049,022.63 million yuan, and its net assets were 1,008,794.70 million yuan ； In 2024, the company achieved operating revenue of 4,210,814.44 million yuan, with a net profit attributable to the parent company amounting to 236,913.53 million yuan. Hengli Petrochemical stated that this merger is conducive to further optimizing the company’s management structure, improving operational efficiency, optimizing resource allocation, reducing management costs, fully leveraging the synergies resulting from resource integration, and promoting the improvement of the company’s quality and efficiency. Hengli Refining and Hengli Chemical are both wholly-owned subsidiaries of the company, and their financial statements are included in the company’s consolidated financial statements. This merger will not have a significant impact on the company’s normal operations, financial condition, or operating results, and there is no risk of harming the interests of the company and all its shareholders, particularly the minority shareholders.