New | China Shipping Development pays HK$1b to boost stake in Beihai Shipping
China Shipping Development, the country’s largest tanker operator by fleet size, is acquiring a 20 per cent stake in a mainland tanker company for HK$1 billion from parent China Shipping (Group) in a bid to capitalise on the growth of hauling petroleum along China’s coast and inland waterways.
The latest purchase raises China Shipping Development’s shareholding in Shanghai Beihai Shipping to 40 per cent. In June, it bought a 20 per cent stake in Beihai from Sinochem International Corp. Other Beihai shareholders include CNOOC Petrochemical Import & Export, with 30 per cent, Silverbond Overseas with 20 per cent and China Ocean Oilfields Services (Hong Kong), another CNOOC subsidiary, with 10 per cent.
China Shipping Development, which also has one of the world’s largest dry-bulk fleets, said in a statement to the Hong Kong stock exchange that the transaction would “further entrench its position in the coastal and domestic crude oil shipping market” in China and enhance its relationship with CNOOC, the firm’s major customer.
The statement said Beihai, which owns a fleet of eight tankers, was forecast to generate HK$455 million and HK$472 million in net profit for 2014 and 2015, respectively. China Shipping Development will be compensated by an indemnity clause with its parent should Beihai’s profits fall short of the projection.
China Shipping Development recorded 39 million yuan (HK$49 million) in net profit for the first half of this year, reversing huge losses from a year ago.
