Hon Hai Subsidiary Secures Shenzhen Factory Rights

Fulian Yuzhan Precision Technology Co., Ltd., a subsidiary of Hon Hai Precision Industry, has finalized the acquisition of real estate usage rights in Shenzhen. The transaction involves portions of factory buildings located at the Foxconn Hongguan Science Park and the Foxconn Science Park in Longhua District. This move is driven by operational needs to secure stable manufacturing capacity for the group's precision technology division.

The board of directors approved the deal on September 14, 2026, following a negotiation process based on market pricing. The total contract rent for the period is 109,363,541.52 RMB excluding tax, while the specific transaction amount for the right-of-use assets is recorded at 105,212,356 RMB. The counterparties are affiliates within the Foxconn ecosystem, specifically Foxconn Technology Group, Fuhuigun Industry, and Futaijie Technology Development.

Transaction Volume and Pricing Details

The acquired asset covers a total area of 322,123.85 square meters, equivalent to 97,442.46 ping. The average pre-tax price was set at 18.24 RMB per square meter. This valuation aligns with the appraisal provided by Shanghai Shenwei Assets Appraisal Co., Ltd., which assigned a value of 105,212,356 RMB to the rights. Two professional appraisers, Huilin Jia and Liang Zhang, certified the report, ensuring compliance with regulatory standards for asset acquisition by public companies.

The rental period spans from May 1, 2026, to December 31, 2027. This two-year and eight-month lease structure allows the subsidiary to integrate the facilities into its production workflow without immediate capex for ownership. The financial impact is reflected in the lease liabilities and right-of-use asset recognition on the subsidiary's balance sheet, supporting long-term operational stability in the Shenzhen market.

Related Party Nature of Deal

The counterparties are identified as affiliates of the Hon Hai group. The primary reason for selecting these related parties was group resource integration, optimizing the allocation of industrial assets across the corporate structure. No dissenting opinions were raised by directors, and the audit committee ratified the transaction on the same date as the board resolution. This internal restructuring ensures that the precision technology division has dedicated space for its specific manufacturing requirements.

Operational Purpose and Compliance

The acquisition is strictly for operational needs, focusing on securing production capacity for precision components. The transaction was executed through negotiation rather than public tender, with pricing referenced against market rates. Regulatory filings confirm that the counterparty is a related party, and the deal complies with Article 16 of the regulations governing asset acquisition by public companies. The absence of brokers and the use of a professional appraisal firm ensure transparency and fair value in this intra-group asset transfer.