Conch Materials Technology (02560) has disclosed that a judicial freeze has been placed on 39 million domestic shares owned by one of its principal shareholders, Linyi Haihong New Materials Technology Co., Ltd. (Linyi Haihong). The affected shares represent approximately 6.73% of the company's total issued share capital.

The freeze was enforced by the People's Court of Hedong District, Linyi City. The restriction is set to remain in effect for a maximum period extending until September 17, 2029.

The board of directors has confirmed that, based on its knowledge, the judicial action stems from a civil dispute involving Linyi Haihong and is unrelated to the company itself. As of the announcement date, Linyi Haihong directly holds 64.6616 million domestic shares and 8.6984 million H-shares, accounting for approximately 12.65% of the company's total issued shares.

Linyi Haihong is owned by non-executive director Zhao Hongyi, Mr. Chen Jun, and Zhuzhou Hongxin Technology Development Co., Ltd., with respective stakes of approximately 83.66%, 11.41%, and 4.93%. Both Mr. Chen Jun and Zhuzhou Hongxin Technology Development Co., Ltd. are considered independent third parties to the company, aside from being minority shareholders of Linyi Haihong.

The company believes the freeze will not have any material adverse impact on the group, as it is unrelated to the company and will not affect its normal business operations, corporate governance, or daily management.