Dazhong Mining to divest Dongwufenzi Iron Ore Processing Plant

Dazhong Mining Co., Ltd. and its wholly-owned subsidiary, Inner Mongolia Dazhong Mining Co., Ltd., agreed to sell the Dongwufenzi Iron Ore Processing Plant and associated surface assets to Inner Mongolia Taixiangxin Mining Co., Ltd. The transaction encompasses the land and structures occupied by the processing facility, production machinery and equipment, and related electronic auxiliary devices. Notably, the sale does not include the mining rights to the Dongwufenzi Iron Ore deposit. The consideration has been set at RMB84.14 million (USD12.41 million) (excluding tax), with a total tax-inclusive price of RMB90.17 million (USD13.31 million).

Commissioned in 2007 with a design capacity of 1,500,000tpy of raw ore, the processing plant has been in continuous operation for 19 years. However, in recent years, declining ore supply from the Dongwufenzi mine has led to persistent underutilization of the plant's capacity and elevated operating costs.

The divestiture aligns with the company's strategic focus on optimizing asset efficiency. By monetizing these underperforming assets, Dazhong Mining aims to enhance liquidity, reduce ongoing maintenance expenditures, tax obligations, and safety management burdens, while sharpening its concentration on core business segments and improving overall operational efficiency.