Shanghai: Sainty Marine has been brought to arbitration by Norwegian owner Boa Offshore in relation to an order for two multi-purpose offshore platform supply vessels (PSVs).
Sainty Marine signed the shipbuilding contract with Nantong Mingde Heavy Industry, China Chengdu Import & Export Group and Boa Offshore for the two PSVs in May 2013.
The Norwegian owner has made the payment for the vessels; however, the shipyard has delayed construction as Mingde has not settled the payment of the ship parts on time.
The details of the arbitration requests are not yet clear, Sainty Marine said.
The company announced the cancellation of four newbuildings last week, which is expected to greatly affect the company’s financial results for this year.
Mingde Heavy Industry, a major shipyard in Nantong, has been unable to repay debts and its assets are not worth enough to repay its creditors.
As the largest creditor of Mingde Heavy Industry, Sainty Marine plans to take over the shipyard through transferring debts to an equity share. [29/12/14]