EDA Group Holdings Limited Announces Major Lease Transaction in the U.S.

Key Highlights for Investors

• Major Lease Transaction: EDA Group Holdings Limited (“EDA” or “the Company”, Stock Code: 2505) has entered into a significant Lease Agreement through its wholly owned subsidiary, EDA Cloud International, Inc., for a large-scale warehouse facility in Palmyra, New Jersey, U.S.A.
• Transaction Classification: The lease constitutes a “major transaction” under Chapter 14 of the Hong Kong Listing Rules as the value of the right-of-use assets exceeds 25% of the Company’s size tests, triggering mandatory disclosures and shareholder approval requirements.
• Shareholder Approval Secured: The Company’s largest shareholders, together holding approximately 57.9% of issued shares, have provided written approval for the transaction, meaning no general meeting is required for approval.
• Financial Impact: The recognized right-of-use asset value is approximately US\$45.5 million (RMB314.0 million), with aggregate base rent over the lease term at about US\$62.8 million (RMB433.8 million). This is a material commitment that will impact the group’s balance sheet and future cash flows.
• Strategic Expansion: The new warehouse, at 457,159 square feet, represents a key step in EDA’s strategy to enhance its global logistics network, supporting continued growth in its AI-powered logistics and B2C e-commerce services.

Full Transaction Details

Lease Agreement Summary

• Date Signed: 6 March 2026 (U.S. time)
• Landlord: SANSONE URBAN RENEWAL ENTITY I, LLC, an independent third party in property investment.
• Tenant: EDA Cloud International, Inc. (wholly owned by EDA Group)
• Premises: 203 Route 73 S, Palmyra, New Jersey, U.S., 457,159 sq ft
• Lease Term: 130 full months (approx. 10 years, 10 months) from 1 April 2026 (the “Commencement Date”)
• Usage: Warehouse storage and distribution, office uses, and ancillary activities
• Base Rent:
  • First 12 months: US\$0.96/sq ft/month
  • Annual average increase: ~3.5%
  • Certain months (10, 11, 12, 23, 24, 25, 26, 128, 129, 130) have conditional rent abatement, provided the Tenant fulfills all obligations
  • Total base rent over the term: approx. US\$62.8 million (RMB433.8 million, exclusive of tax)
• Additional Rent:
  • Tenant pays a 65.08% proportionate share of property-related costs, including operating expenses, utilities, taxes, insurance, and property management fees, calculated on the area occupied within the building (457,159 sq ft out of 702,450 sq ft).
• Security Deposit: US\$1.6 million (RMB11.0 million)
• Lease Guaranty: EDA International Inc. and EDA Group Holdings Ltd. provide unconditional and absolute guarantee of the Tenant’s performance under the lease.
• Payment Terms: Rent (base + additional) is payable monthly in advance, funded from the Group’s internal resources.

Strategic Rationale and Shareholder Considerations

• The lease secures a large, strategic warehouse for self-operation in the U.S., supporting EDA’s goal of becoming a global leader in artificial intelligence logistics technology and empowering cross-border B2C e-commerce, especially for PRC exporters.
• The lease’s terms were negotiated at arm’s length, referencing market rates and comparable transactions, and are deemed fair and reasonable by the Board.
• EDA’s two largest shareholders, EDA Shine International Limited (controlled by founder and Chairman Mr. Liu Yong) and Samanea China Holdings Limited (subsidiaries of China Lesso Group Holdings Limited), together hold 57.9% of issued share capital and have unanimously approved the transaction in writing, removing the need for a general meeting.
• No shareholder is required to abstain from voting, and no connected person is involved in the transaction.
• A circular (for information only) will be sent to shareholders by 27 March 2026, summarizing the transaction and its implications.

Potential Share Price Implications / Price Sensitive Information

• Scale of Commitment: The lease is a major financial commitment that will materially impact EDA’s consolidated financials, including the recognition of a right-of-use asset and lease liabilities under HKFRS 16.
• Strategic Expansion: The new warehouse significantly expands EDA’s U.S. logistics footprint, enabling greater service capacity and operational efficiency, which may enhance future revenue and market position.
• Financial Flexibility: The lease is funded by internal resources and does not appear to require external financing, reflecting EDA’s strong liquidity position.
• Shareholder Confidence: The support and alignment of the controlling shareholders (together holding 57.9%) may be viewed positively, as it demonstrates commitment to the company’s growth strategy.
• Regulatory Compliance: EDA’s handling of the transaction under Listing Rules, including securing written approval from closely allied shareholders, demonstrates strong governance and transparency.

Board of Directors & Company Information

• Key Executives: Mr. Liu Yong (Executive Director and Chairman), Ms. Li Qin, Mr. Cheung Man Yu (Executive Directors), Mr. Zuo Manlun and Mr. Luo Jianfeng (Non-Executive Directors), Mr. Chan Kwok Cheung Kevin, Mr. Ng Cheuk Him, and Mr. Wong Ping Yee Natalis (Independent Non-Executive Directors).
• Company Profile: EDA Group Holdings Limited is an exempted limited liability company incorporated in the Cayman Islands, specializing in artificial intelligence logistics technology solutions empowering B2C export e-commerce, especially for the PRC market.

Disclaimer: The information contained in this article is derived from the official company announcement and is provided for informational purposes only. It does not constitute investment advice. Investors are advised to review the forthcoming shareholder circular and consult professional advisers before making investment decisions. The actual financial impact and strategic benefits of the transaction may depend on future market developments and company execution.

View EDA GROUP HLDGS Historical chart here