Chinese shipbuilding group China Ocean Industry has entered into an agreement with Nantong Huachuan Transport Equipment for the sale and acquisition of a 60% equity interest in Nantong Huakai Heavy Industry, a steel product and marine equipment manufacturer.
The price of the deal is RMB20m ($2.89m). The asset value of Huakai Heavy has shrunk substantially in the past three years since China Ocean Industry took over full equity of Huakai Heavy Industry in November 2016 for a price of RMB270m ($39.3m).
China Ocean Industry said the disposal will enable the company to reallocate its resources to other existing business while reducing its liabilities and alleviate its financial position.
Last month, China Ocean Industry was forced to transfer its entire 24% equity interest in Nantong Xiangyu Ocean Equipment to creditors due to its inability to repay debts.
In March, the company also sold its shares in a leasing joint venture to repay debt.