PAN HONG HOLDINGS GROUP LIMITED: Key Update on Arbitration Proceeding

Summary of Announcement

Pan Hong Holdings Group Limited (the “Company”), a property development group incorporated in Bermuda and listed on the Singapore Exchange, has disclosed a significant legal development involving its indirect wholly-owned subsidiary, Shanwei Pan Hong Runhe Property Development Limited (“Shanwei Runhe”).

Key Points Investors Should Note

• Arbitration Initiated: Shanwei Runhe has received a Notice of Arbitration issued by the Shanghai Arbitration Committee. The arbitration is initiated by Tongji Architectural Design (Group) Co., Ltd. (“the Plaintiff”) and relates to a Property Design Service Agreement.
• Claimed Amount: The total sum claimed by the Plaintiff includes:
  • Outstanding design fee of RMB4.8 million
  • Time-based penalty arising from the outstanding fee (quantum not specified in the announcement)
  • Legal and arbitration expenses of RMB50,000
• Asset Freeze: As a result of the arbitration, a bank account held by Shanwei Runhe at Bank of China has been temporarily frozen. The balance in this account is RMB53,852.20 as of 7 April 2026.
• Legal Position and Risk: The Company is in the process of obtaining legal advice from its Chinese legal counsel to determine the best course of action. Importantly, the management has assessed that the quantum of the claim is not material relative to the net assets of Shanwei Runhe. Therefore, the likelihood of mandatory liquidation proceedings by the Plaintiff is considered relatively low.
• Ongoing Business Operations: Despite a challenging property market and slower sales pace, the Group continues to market and sell property units monthly. This ongoing activity is aimed at generating cash flow for working capital needs and to cover any potential arbitral award.
• Shareholder Communication: The Company has pledged to keep shareholders updated via announcements on SGXNET as further developments arise.

Implications for Shareholders and Potential Share Price Impact

This arbitration, while currently assessed as not material to the subsidiary’s net assets, may nonetheless be viewed by the market as a negative development, especially given the freezing of a bank account and the ongoing slowdown in property sales. Investors should note the following:

• The arbitration highlights operational and financial risks which may affect investor sentiment, despite management’s assessment of low risk of liquidation.
• Any negative ruling and subsequent payment obligation (if the full amount claimed is awarded) will require the Group to allocate resources, although management believes cash flow from ongoing sales will be sufficient.
• The Company’s transparency in updating shareholders and seeking professional advice should provide some reassurance regarding risk management.
• Shareholders are strongly advised to refrain from taking any action regarding their holdings that may be prejudicial to their interests and are encouraged to consult their professional advisors.

Next Steps and Guidance for Investors

The Company will continue to update shareholders as the arbitration process evolves. Until additional material developments are announced, shareholders are encouraged to remain vigilant and consider the potential impact of this matter on the Company’s operations and share value.

Disclaimer

This article is a summary and analysis based on official disclosures. Investors should not interpret this as financial advice and are advised to consult their own professional advisors before making any investment decisions. The Company’s official announcements and SGXNET updates should be considered as the primary sources of information.

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