UNIVERSAL TECH has announced the signing of a sale and purchase agreement. The agreement, dated June 5, 2026, involves the company, the seller (an indirect subsidiary of the company), the buyer Dongguan Hongshunshaohe Development, and the target company Dongguan Qinghui Property.

Under the terms of the agreement, the seller has conditionally agreed to sell, and the buyer has conditionally agreed to acquire, a 49% equity interest in the target company for a consideration of RMB 8.5 million (approximately HK$ 9.8 million).

The primary business activity of the target company is holding the entire equity interest in Water Supply Expansion Company. Water Supply Expansion Company is a limited liability company incorporated in China and is a wholly-owned subsidiary of the target company. Its main operation involves providing pipeline water supply to Qingcheng District, Qingyuan City, Guangdong Province, China.

Water Quality Testing Company, a limited liability company incorporated in China and a wholly-owned subsidiary of Water Supply Expansion Company, is primarily engaged in providing water quality testing services.

The board of directors believes the disposal presents a favorable opportunity for the group. It is expected to reduce risks associated with disputes and litigation and eliminate the negative impact on the group's profitability caused by high water fees levied by government-designated water plants.

Furthermore, the transaction will allow for the deconsolidation from the group's consolidated financial statements of the accounts payable from the water supply business and other payables arising from additional fees, both currently classified as current liabilities. This is anticipated to significantly improve the group's net asset position and its net current asset/(liability) status.

The directors further noted that the disposal involves only a portion, not all, of the group's water supply business assets. The remaining group will continue to operate the water supply business in Qingxin District through the retained water supply entities. This business, together with the property and financial services segments, constitutes a viable, sustainable, and substantial operational and asset value base.