HK Stock Market Move | CHONGQING M&E (02722) drops over 3%, plans to sell 51% equity in Chongqing Caff Automotive Brake & Steering System

CHONGQING M&E (02722) fell over 3%, down 2.63% as of press time, at HK$1.48, with a turnover of HK$7.7135 million. On the news front, CHONGQING M&E issued an announcement that on October 12, 2026, the company entered into an equity transfer agreement with Silian Group (a wholly-owned subsidiary of the company's controlling shareholder), pursuant to which the company agreed to transfer, and Silian Group agreed to acquire, a 51% equity interest in the target company (Chongqing Caff Automotive Brake & Steering System Co., Ltd., a wholly-owned subsidiary of the company) held by the company, at a consideration of RMB 89.7916 million. The target company is principally engaged in the research, development and production of commercial vehicle steering tie rod (joint) assemblies and thrust rod assemblies, passenger vehicle suspension subframes and control arm assemblies, new energy battery boxes and structural components for energy storage equipment, etc. The announcement stated that, as the target company's principal business is the manufacture and servicing of automotive parts, which has weak synergy with the company's clean energy equipment and high-end intelligent equipment industries and makes it difficult to form upstream and downstream industrial support, the disposal will help the company focus on its principal business and optimize its strategic layout. Therefore, upon completion of this disposal, the target company will no longer be included in the company's consolidated financial statements, which will help the company optimize its industrial layout, concentrate its efforts and resources, deepen its principal business development, and promote the strengthening and optimization of the company's core industries.