Shanghai Bestway facing non-payment for several shipbuilding contracts

Shanghai Bestway facing non-payment for several shipbuilding contracts

Chinese ship design and shipbuilding firm Shanghai Bestway Marine Engineering Design is facing multiple risks in several major shipbuilding contracts, which would potentially hurt the company financially, according to the company’s third quarter report.

The company believes there’s a risk that it won’t receive payment from Dalian Inteh Group as scheduled under a EPC contract for the construction of a 28,000 cu m LNG carrier due to the buyer being unable to secure financing.

Shanghai Bestway also reported a risk of not being able to collect payment from Singapore owner H&C Marine Engineering under the construction contract for two liftboats, which have already been delivered, for similar financing reasons.

Additionally, the company’s contract with Centaur Marine for the construction of a liftboat has been suspended and the management believes the contract wouldn’t see any practical progress in the short term.

Shanghai Bestway has booked impairment loss of RMB388m ($56m) in total for the three contracts.

Shanghai Bestway has been facing challenges due to a lack of new orders and the company’s controlling shareholder, Liu Nan, failed in two attempts to sell his shares in the company earlier this year.

Jason Jiang

Jason worked for a number of logistics firms following his English degree, then switched this hands-on experience to writing and has since become one the most prolific writers on the diverse China logistics industry writing for a host of titles including Supply Chain Asia, Cargo Facts and Air Cargo Week. Jason’s access to the biggest shippers with business in China has proved an invaluable source of exclusives.

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