Yuexiu Transport passes resolution by a vast majority of votes at special general meeting on acquisition of Lanwei Expressway

Further expand business presence in Central China and continue to enhance toll revenue and profit contribution

HONG KONG SAR - Media OutReach - 18 November 2022 - Yuexiu Transport Infrastructure Limited (“Yuexiu Transport” or the “Company”; stock code: 01052) today held a special general meeting to pass resolution on the acquisition of 100% of equity interests in the company which operates Lanwei Expressway in Henan Province from Guangzhou Yuexiu Holdings Limited at a total consideration of RMB1.098 billion.

The resolution was passed by a vast majority votes of 99.98%.

Upon completion of acquisition of Lanwei Expressway, the project will continuously contribute to the Company’s toll revenue and profit, and increase the earnings per share starting from 2023. The internal rate of return of the acquisition is expected to reach 9.5%, which is rare in the current economic environment. The Company intends to finance the total consideration by internal resources and bank loan for acquisition while the gearing ratio will only slightly increase from 48.4% to 52.5%, which does not affect the Company’s financial stability. After the announcement, both Moody's and Fitch issued the press releases and stated that the Lanwei acquisition will have no impact on Yuexiu Transport’s credit profile.

Over the years, Yuexiu Transport has been grasping the strategic opportunity of “promoting the rise of Central China”, continuing to explore projects in high quality in Central China region. Up to now, it has successfully acquired seven projects in Henan, Hubei, and Hunan, forming a development paradigm of “gaining a foothold in the Guangdong-Hong Kong-Macao Greater Bay Area and developing in Central China region”. This acquisition of Lanwei Expressway is another asset expansion for the Company to enter the Central China region. After the acquisition, the asset scale, revenue scale and profitability will be further enhanced, while the toll mileage of the Company’s controlled expressways will increase from 495.2 km to 556.23 km, representing an increment of approximately 12.3%.

Lanwei Expressway has been in operation for nearly 17 years since it opened to traffic in 2005. It has a total mileage of 61.03 km while the expressway networks connecting to Lanwei Expressway are all very mature and stable. The Company is optimistic about the economic development in Central China in the long run. The acquisition of Lanwei Expressway aligns with the Company’s strategy of developing in the Central China region and the Company believes that Lanwei Expressway, located in the core development areas of the Central Chinese Plain city clusters, will continue to benefit from the regional strategic developments such as the “Rise of Central China” as well as the construction of the Central Chinese Plain city clusters and the Zhengzhou Metropolitan Area. At the same time, the connection between Lanwei Expressway and Weixu Expressway, a project wholly-owned by the Company, fosters a more united and consistent approach of operation management and facilitates the Company to set up a district-based management and control model, which can provide economies of scale and enhance management efficiency.

Yuexiu Transport expresses that the acquisition will enhance its shareholders’ value and replenish the Company’s quality asset portfolio after the spin-off and listing of Han-Xiao Expressway though the public offering of Expressway REIT. After the establishment of REITs platform, Yuexiu Transport will proactively pursue quality project reserve and strike a balance between “investment and divestment of the assets”. The asset injection of Lanwei Expressway to the listed company is a major initiative of the Company’s development strategy in 14th Five-Year Plan, which allows the Company to consistently promote the interactions of the three platforms.

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About Yuexiu Transport Infrastructure Limited

Yuexiu Transport Infrastructure Limited is principally engaged in investment, operation and management of toll expressways, bridges and port in Guangdong Province and other high-growth provinces in mainland China. The Company will seize the strategic opportunities for mergers and acquisitions of expressway assets to establish a solid presence in the Guangdong-Hong Kong-Macao Greater Bay Area and other regions that will benefit from the continuous urbanization and rapid industrialization. In terms of its asset portfolio, mature projects such as GNSR Expressway, Suiyuenan Expressway and Weixu Expressway are the stable profit contributors of the Company. Other projects acquired in recent years have given new impetus to the Company’s growth driver. On 14 December 2021, the Company successfully spun off Han-Xiao Expressway, which was listed on the Shenzhen Stock Exchange as a publicly offered Infrastructure REIT. Han-Xiao Expressway is no longer a subsidiary of the Company. At present, the Company has invested in and is operating a total of 16 projects encompassing toll roads, bridges and a port, including 9 in which the Company has controlling equity stakes and 7 which the Company has invested in through associates and joint ventures. The total mileage of the Company’s toll expressways and bridges attributable to its equity interests is about 495 km.

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