Gree Electric announced today that its largest shareholder, Zhuhai Mingjun Investment Partnership (Limited Partnership), plans to reduce its holdings of the company's shares by no more than 111.7028 million shares in a block transaction within 3 months after 15 trading days from the date of the announcement, accounting for 2% of the company's total share capital after excluding the shares in the special account for repurchase.The reason for the reduction is the repayment of bank loans, and the source of the shares is the shares transferred from Gree Group through an agreement on January 23, 2020.
According to domestic media reports, Gree Electric responded by saying that this reduction was a normal financial arrangement after Zhuhai Mingjun fulfilled its share lock commitment.
After this equity change, Zhuhai Mingjun still maintains Gree Electric’s single largest shareholder status.
Gree Electric said that this reduction will not lead to a change in the company's control, nor will it affect the company's governance structure and production operations.
It is understood that Zhuhai Mingjun is an investment entity led by Hillhouse Capital. During Gree Electric’s mixed-ownership reform in 2019, it acquired 15% of the company’s shares for 41.662 billion yuan.The acquisition funds include a large amount of bank loans. This reduction directly points to the repayment needs of mature loans. It is also the first time that it has disclosed a reduction plan in the six years since it took over Gree Electric Appliances.
Calculated based on Gree Electric’s closing price of 38.49 yuan/share on February 25, the cash amount of this top-level reduction is approximately 4.3 billion yuan.