Guangzhou Shipyard to issue shares to buy shipyard
Guangzhou Shipyard International Co said on Tuesday it plans a rights issue to fund the purchase of a shipyard for up to 3.1 billion yuan ($452 million) from its state-owned parent company.
Guangzhou Shipyard will offer three shares for every 10 shares held by owners of its Hong Kong-listed H shares and Shanghai-listed A shares, at a price of no less than 4.96 yuan per share, it said in a statement.
The company's A shares were down 7 percent in late afternoon trade at 23.5 yuan, underperforming a 3.2 percent drop in Shanghai's benchmark index .SSEC. The Hong Kong exchange was closed for a national holiday.
China State Shipbuilding Corp (CSSC), the company's parent firm, has put its Guangzhou-based Wenchong Shipyard up for sale on the Beijing Equity Exchange.
Guangzhou Shipyard will sign a purchase deal with CSSC on Aug. 5 if no other qualified contenders register to bid, the statement added.
CSSC set strict conditions for the purchase, stipulating that the buyer must be in the shipbuilding business, have earned more than 300 million yuan in net profit each year from 2005 to 2007, and have built ships with a total of at least 500,000 dead weight tonnes in fiscal year 2007, according to the Beijing exchange's website.
The buyer would also have to be state-owned or state-controlled, with total assets of no less than 10 billion yuan at the end of 2007, it said.
Guangzhou Shipyard will offer three shares for every 10 shares held by owners of its Hong Kong-listed H shares and Shanghai-listed A shares, at a price of no less than 4.96 yuan per share, it said in a statement.
The company's A shares were down 7 percent in late afternoon trade at 23.5 yuan, underperforming a 3.2 percent drop in Shanghai's benchmark index .SSEC. The Hong Kong exchange was closed for a national holiday.
China State Shipbuilding Corp (CSSC), the company's parent firm, has put its Guangzhou-based Wenchong Shipyard up for sale on the Beijing Equity Exchange.
Guangzhou Shipyard will sign a purchase deal with CSSC on Aug. 5 if no other qualified contenders register to bid, the statement added.
CSSC set strict conditions for the purchase, stipulating that the buyer must be in the shipbuilding business, have earned more than 300 million yuan in net profit each year from 2005 to 2007, and have built ships with a total of at least 500,000 dead weight tonnes in fiscal year 2007, according to the Beijing exchange's website.
The buyer would also have to be state-owned or state-controlled, with total assets of no less than 10 billion yuan at the end of 2007, it said.