XXF (02473) plans to acquire control of New Qite for HKD 150 million, expanding its business into the automotive after-sales service sector.

XXF (02473) announced that on August 4, 2026, the company plans to acquire all issued share capital of PAGAC NTS Limited from Jia Rui Development (Hong Kong) Limited for approximately HKD 150 million. The payment will be made by issuing 380 million consideration shares to the seller at the issue price upon completion, with each consideration share priced at HKD 0.3947, representing a discount of about 21.8% compared to the closing price of HKD 0.505 per share on the Stock Exchange on the date of the sale agreement. The consideration shares will account for approximately 16.99% of the enlarged share capital. It is reported that the target company directly holds all of NTS's issued share capital, and NTS directly holds approximately 85.45% of the equity in New Qite (currently equivalent to about 94.94% of economic and voting rights). After the completion of the sale agreement with the seller (especially after Shanghai Yiru's capital reduction), NTS's actual shareholding in New Qite will increase to approximately 94.94%. New Qite primarily engages in comprehensive automotive aftermarket services in China, covering all aspects of vehicle-related needs, including maintenance and repair, beautification and customization, tires and rims, as well as automotive insurance. New Qite is headquartered in Shanghai. As of May 31, 2026, New Qite operates 24 stores nationwide, all of which are company-owned, including 7 in Shanghai, 9 in Fujian, 6 in Nanjing (including one store not yet opened), and 2 in Suzhou. The company believes that the proposed acquisition provides a strategic opportunity for the group to expand the business scope and enhance long-term competitiveness by extending from the automotive finance sector into the automotive aftermarket service sector. The group mainly engages in: (i) automotive retail and financing business, through which the group primarily sells non-luxury vehicles via direct financing lease arrangements; (ii) automotive-related business, through which the group mainly provides vehicle operating lease services and other automotive-related services; and (iii) direct automotive retail business, through which the group sells vehicles in a one-time manner. Through the proposed acquisition, the group will gain control over the target company and its main operating subsidiary, New Qite. New Qite is an automotive service chain enterprise headquartered in China, primarily engaged in vehicle maintenance and repair as well as other related automotive services. The proposed acquisition will allow the group to establish a platform that combines automotive finance with downstream vehicle services, thereby extending its business footprint into a wider segment of the automotive value chain. The company believes that integrating automotive finance and automotive services can promote the establishment of a more comprehensive automotive ecosystem that covers vehicle acquisition, financing, usage, maintenance, and eventual resale or trade-in. Automotive aftermarket services generally exhibit characteristics of repeat customer demand and relatively high service frequency, especially for maintenance and tire replacement services. By entering the independent automotive aftermarket through New Qite's service network, the group can achieve revenue diversification. The board believes this diversification can enhance the overall resilience of the groups business model and provide additional recurring revenue sources from end-user customers. Furthermore, the proposed acquisition will create cross-selling opportunities. New Qite serves passenger car owners in multiple cities across China, with customers visiting regularly for maintenance and service needs. The company believes that this customer channel can provide the group with more customer touchpoints to promote automotive financing products, installment payment arrangements, and other automotive-related financial services. Integrating services and financing solutions can improve customer acquisition efficiency, strengthen customer retention, and enhance overall customer lifetime value. Additionally, vehicle service data may assist the group in refining its credit assessment, asset monitoring, and residual value management processes for financed vehicles, potentially strengthening the groups risk management capabilities.