The transaction allows the group's liner arm to lease the vessels for one year at below market price Hong Kong-listed China Shipping Development (CSD) appears to have given its state-owned parent a Christmas present yesterday with a 15-vessel charter deal booked at rates well under present market value. The main beneficiary of the arrangement was parent China Shipping Group's dedicated liner arm, China Shipping Container Lines (CSCL), which for one year will lease from CSD subsidiaries nine small and medium-sized container ships, some for just 30 per cent of the market rate. 'If those vessels were posted in the present market, they would have achieved a significant premium and would have had no problem finding charterers,' said Tim Huxley, managing director of Clarkson Asia (Hong Kong), a leading maritime consultancy. Because the CSD valuation of the deals - about HK$171 million - was less than 3 per cent of its net asset value (NAV), Hong Kong stock exchange regulations did not require it to seek approval for the transactions from independent shareholders. Based on charter market prices for the vessels provided by Mr Huxley, however, the aggregate value of the 15-vessel deal was about HK$430 million, or roughly 6.5 per cent of CSD's NAV at last report. CSD last year sold its 25 per cent stake in CSCL back to the parent for a nominal fee and no longer has an interest in the liner company. David Webb, a shareholder activist and a director of Hong Kong Exchanges and Clearing, said: 'It appears to be another one of those Christmas Eve specials. 'It sounds to me as if the exchange should be looking into this transaction. 'If its 'fair market value' exceeded 3 per cent of NAV, approval from independent shareholders was required.' Mr Webb said the fact the exchange was not required to independently verify whether transactions exceeded 3 per cent of NAV was 'a flaw in the listing rules'. Two of the six connected transactions worked in CSD's favour. But the aggregate deal appeared to deprive the listed company of about $292 million in potential revenue, based on yesterday's daily vessel charter rates. Mr Huxley said: 'These are 12-month fixtures. It is not as if [CSD] was taking a long-term view.' He said the deal should also be viewed in the light of the potential for next year's market for charterers. Daily rates are expected to be near the height of the cycle for lessors. One portion of the six-part connected transaction saw CSD on Tuesday bareboat charter to CSCL four 18,000 gross-tonne converted box ships for an average of US$1,666 per day. On the open market those vessels would fetch about US$6,500 per day, Mr Huxley said.