Jiayou International (603871.SH): Joint investment with related parties to activate the Tazara Railway project

Gelonghui April 1丨Jiayou International (603871.SH) announced that the company plans to jointly invest in the TAZARA Railway activation project with its related parties Zijin Jinsheng and non-related parties China Civil Engineering, Luoyang Molybdenum, and COSCO Hong Kong, through a jointly invested target company, LinkFutureInvestmentLtd. The main contents of this joint investment project include carrying out fundamental repair and renovation of railway lines, purchasing new locomotives and rolling stock, etc., and after the repair and renovation are completed, being responsible for operating TAZARA Railway freight services.

The total investment amount for this project is $1.24B. All investing parties will make capital contributions in USD cash as monetary contributions, among which the company’s investment amount is $62.15 million, accounting for 5%.

As a key passage for the export of copper and cobalt resources from the Democratic Republic of the Congo (DRC) copper-cobalt mining belt through Zambia and onward to the sea, the TAZARA Railway plays an important role in promoting regional resource circulation and industrial cooperation. By participating in this project, the company can enable deep coordination and linkage between its business layout on the TAZARA Railway and infrastructure such as inland ports, highways, and ports of entry that have already been planned and built in countries including the DRC, Zambia, and Tanzania. Meanwhile, the project will lay a solid foundation for the construction of supporting facilities along the railway, such as railway stations and freight handling yards and overseas warehouses, effectively integrating the existing road transportation network. This will help the company improve its intermodal rail-to-road transportation service system along the TAZARA Railway, thereby further upgrading its cross-border integrated logistics full-industry-chain service capability in Southern and Central Africa and continuously consolidating the company’s core competitive advantages in the African region.

After the capacity of the TAZARA Railway is enhanced, cross-border transportation time will be significantly shortened, and loading and transshipment capacity will be significantly strengthened. This will effectively reduce the company’s business reliance on road transportation, save long-distance transportation costs, and comprehensively improve the timeliness of logistics services. The company will be able to provide more efficient and stable supply chain services to customers in relevant upstream and downstream industry chains such as bulk mineral products and agricultural products, helping customers lower total logistics costs, thereby enhancing its comprehensive service capability and customer stickiness.