Shenzhen Investment Holdings Bay Area Development Company Limited (Bay Area Dev; HKEX: 00737) announced that its 50%-owned deemed subsidiary, Guangdong Guangzhou-Zhuhai West Superhighway Co. Ltd. (GZ West JV), has signed a Digital Transformation Construction Works Agreement with Guangdong Lulutong Co. Ltd. (the Contractor), a subsidiary of Guangdong Provincial Communication Group (GPCG).
The RMB36.07 million contract, awarded through an open tender at Guangzhou Public Resources Trading Center, covers the intelligent upgrade of 11 toll stations and two pairs of service areas along the Guangzhou-Zhuhai West Superhighway. Key installations will include self-service lanes, smart card-issuing and payment machines, vehicle-type recognition devices, dual-function barrier gates, folding screens, HD cameras and vehicle-inspection instruments, alongside related systems and materials. The construction window is set at 20 months from commencement.
Financing for the project will come from GZ West JV’s internal resources. An advance payment of 30% of the contract value is scheduled, with staged disbursements tied to equipment delivery, work progress and annual “Competitive Assessment Awards” linked to performance ratings by the PRC Ministry of Transport and Ministry of Finance. The Contractor must lodge a 10% performance guarantee and a separate RMB0.60 million wage guarantee; a 3% quality-guarantee deposit will be retained for up to five years post-completion.
Regulatory perspective: • The Contractor is an associate of Guangdong Highway Construction, a substantial shareholder of GZ West JV; transactions therefore constitute connected transactions under Chapter 14A of the HKEX Listing Rules. • Six earlier construction agreements between GZ West JV and GPCG subsidiaries, signed from August to December 2025 and aggregating RMB29.12 million, are required to be grouped with the latest contract. • The combined transaction value reaches RMB65.19 million, causing one or more applicable percentage ratios to exceed 1% but remain below 5%. Consequently, the aggregated transactions trigger announcement and reporting obligations but remain exempt from shareholder approval and annual review requirements.
Strategic rationale: Management views the digital upgrade as a national strategic initiative to enhance highway intelligence, efficiency and safety. Smart toll stations and service areas are expected to improve traffic flow, enable real-time data analytics and bolster the competitiveness of GZ West Superhighway within the Greater Bay Area’s toll-road sector.
The Board, including all independent non-executive directors, considers the contract terms fair, reasonable and in the interests of the company and its shareholders. No director was required to abstain from voting on the resolution approving the agreement.