Shanghai: Shipbuilder JES International Holdings is suing a Chinese businessman for breach of a moratorium during its acquisition of a forestry business in Congo, Africa.
Singapore-listed JES agreed in April to use cash and shares to buy a 51% stake in Scibois Co, owner of a Congo-based company involved in extraction of timber from a forest valued at over US$3 billion.
JES transferred the first tranche of its shares to one of the two vendors, Chinese national Yang Shushan, in July. Both parties had agreed in a moratorium not to transfer or dispose of the JES shares within a period of 12 months, according to the shipbuilder. In July it was discovered that Yang had transferred 60 million shares to the account of a “sub-depository agent”.
According to a regulatory filing today, Yang has sought legal action to set aside the court injunction granted last month by Singapore’s High Court, preventing him from selling or pledging the shares. JES also wants Yang to return those shares already transferred.
Yang claims that he does not read English and that he and the other vendor, Yang Nan, signed the sale and purchase agreement with JES without understanding the terms.
“The company also wish to bring to the attention of shareholders that during the course of conducting due diligence on the target group, the vendors were not forthcoming in providing the necessary support, which shows that the vendors were not acting in good faith,” Jin Xin, Chairman and CEO of JES, said in today’s statement. [01/10/14]