Shanxi Install (02520) and Shanghai Jingyu have reached a joint venture agreement with Shanxi Infrastructure to establish a joint venture company to invest in a BOO project.

SHANXI INSTALL (02520) announced that on February 3, 2026, the company, Shanghai Jingyu, and Shanxi Infrastructure have entered into a joint venture agreement to establish a joint venture company for investing in a BOO project. The company, Shanghai Jingyu, and Shanxi Infrastructure will respectively contribute RMB 43,896,200, RMB 27,933,900, and RMB 7,981,100, representing 55%, 35%, and 10% of the registered capital of the joint venture company. The company will provide funding for its contribution to the joint venture company from its internal resources. After the establishment of the joint venture company, it will become a non-wholly owned subsidiary of the company. The purpose of establishing the joint venture company is to invest in the BOO project, which involves the construction and operation of a zero-discharge sewage treatment facility for the Shanxi Orchid Energy Conservation and Environmental Protection Upgrade Project, including sewage treatment systems, domestic sewage reuse systems, saline wastewater treatment systems, concentrated saline water treatment systems, and evaporation crystallization systems. The joint venture company will be responsible for the construction, operation, and maintenance of the BOO project, as well as collecting sewage treatment service fees. The total investment of the BOO project is estimated to be RMB 267 million. Apart from the equity investments from the joint venture parties for setting up the joint venture company, the remaining investment will be obtained through external financing. The construction period of the BOO project is expected to be 15 months, and the operation service period will be 20 years, after which the cooperation arrangements will be renegotiated by all parties. The directors anticipate that the BOO project will bring the following benefits to the company: a projected operating period of up to 20 years will provide the company with long-term and sustainable investment returns, enhancing its profitability and risk resistance. Through investing in the BOO project, the company can further consolidate its market position in industrial wastewater treatment, improve the environmental protection industry chain of "solid waste + water service," and align with the company's long-term development plan in low-carbon environmental protection industry. The company will accumulate experience in municipal sewage treatment projects through the operation of the joint venture company, and strengthen its technical capabilities in the challenging field of industrial wastewater treatment through the implementation of the BOO project. According to the requirements of Shanxi Province, coking/coal chemical enterprises are required to have zero-discharge wastewater facilities. As a provincial upgrade project, the BOO project has a demonstration significance, allowing the company to accumulate experience and establish a foundation for undertaking similar projects of other enterprises in the province in the future.