According to the announcement, Nantong Mengbaihe Equity Investment Co., Ltd. (hereinafter referred to as “Nantong Menglily”), a wholly-owned subsidiary of Mengbaihe, intends to transfer its holding of Shenzhen Langlefu Sleep Technology Co., Ltd. (hereinafter referred to as “Shenzhen Langlefu”) 55.01 % of the equity was transferred to Guangdong Shunde Langlefu Holding Development Co., Ltd. (hereinafter referred to as “Guangdong Shunde”), and the equity transfer amount was RMB 92.40 million.

As of March 31, Shenzhen Lang Lok Fu had a net asset of 10.9837 million yuan, and the valuation of this equity transfer transaction was at a premium of 15.30 times compared to the book value.

According to the announcement, after the completion of the equity transfer, Nantong Mengbaihe, a wholly-owned subsidiary of Mengbaihe, will no longer hold the equity of Shenzhen Langlefu. The purpose of this equity transfer is to speed up the sorting out of Menglily’s existing business segments and optimize the asset structure, which is conducive to reducing the asset-liability ratio and revitalizing existing assets, in line with the long-term development plan, and has no adverse impact on normal production and operation. the interests of the company and all shareholders.

On June 9, the second meeting of the fourth board of directors held by Menglily reviewed and approved the “Proposal on the Transfer of Equity Interests of Wholly Owned Subsidiaries” with 7 votes in favor, 0 votes against, and 0 abstentions.

The announcement shows that the transaction of Menglily does not constitute a related party transaction, nor does it constitute a major asset reorganization.