Cosco Pacific, a major mainland port operator, said yesterday that it was selling its 20 per cent stake in Chong Hing Bank and would use the US$89.9 million net profit to pay a special dividend and expand its port and container leasing business.
'It is expected that the company will distribute a 20 HK cents per share special dividend,' said Anderson Chow, transport analyst for Macquarie Research, adding the firm would use about half the net proceeds from the sale for the dividend.
Xu Minjie, the company's vice-chairman, said: 'We will use the [remaining] proceeds from the share sale to finance our port acquisitions and development, as well as expand our container leasing business.'
The company will receive HK$2 billion in cash in exchange for its 87 million shares in the bank.
Cosco Pacific also expects to write back this year US$55 million which had been set aside as provisions for the put option issued by it to shareholders of its A-share associated company - China International Marine Containers (Group). In the first half, the company wrote back US$11 million from the provision.
Cosco Pacific is the world's sixth-largest port operator and the third-biggest container leasing company.
The firm has ports in Dalian, Tianjin, Shanghai, Ningbo and Nansha.