Shanghai-listed CSSC Science & Technology, a marine technology unit of China State Shipbuilding Corporation (CSSC), has terminated a restructuring deal to integrate another CSSC technology unit Haiying Enterprise along with a fund raising deal after the potential restructuring was rejected by the securities authority.
CSSC Science & Technology released the restructuring plan in August under which it planned to acquire Haiying Enterprise, a subsea ultrasonic equipment manufacturer, from CSSC Group and another CSSC unit for a total price of RMB2.11bn ($301m) as part of CSSC’s effort to restructure its technology business. The company also intended to issue new shares to specific investors to raise RMB1.12bn funds.
Earlier this week, China Securities Regulatory Commission (CSRC) rejected the deal due to major uncertainties relating to the future profitability of Haiying Enterprise.
Chinese state-run shipbuilders CSSC and CSIC are currently in the middle of a complex merger process involving eight listed companies. Both groups have started a series internal restructurings to pave way for the major merger deal.