Shanghai Bestway Marine & Energy Technology has announced that controlling shareholder Liu Nan has terminated a plan to sell his 17.81% shares of the company to state-run Yangzhong Financial Holding Group.
The two parties signed a letter of intent for the sale in June, however have now terminated the deal as the shareholders of two companies couldn’t reach an agreement on the deal.
In the meantime, Liu has signed a share transfer agreement with Hongmao Shengrong Investment to sell the controlling shares for RMB168m ($24.7m). As part of the deal, Hongmao Shengrong Investment will provide a RMB30m low-interest loan to Shanghai Bestway and another RMB150m loan to Liu to help him free the shares from bank mortgage.
Shenzhen-listed Shanghai Bestway mainly offers ship design services and operates a shipbuilding business through its subsidiary yard Dajin Heavy Industry.
The company has been facing challenges due to a lack of new orders and suffered a sharp decline of 72.7% in profit in the first quarter of this year. The company’s share value also retreated by more than 30% so far this year.