Hong Kong-listed Sinotrans Shipping, a shipping unit of China’s state-run shipping and logistics major Sinotrans & CSC, has released a timetable regarding the company’s proposed privatisation plan.
Sinotrans Shipping plans to sell 65.13% of the company’s issued shares at a price of HK$2.7 per share. Total value of the deal could reach around HK3.37bn ($430m).
The company will hold an EGM meeting on December 13 to vote on the proposed privatisation plan and the company will suspend trading of its shares on Hong Kong Stock Exchange until December 17.
The company plans to delist from the exchange on January 14, and has appointed UBS as its financial adviser in connection with the proposal.
“The global shipping industry has been confronted with severe challenges over the past decade as the revival of the world economy and international trade have been below expectation while the capacity of the fleet has continued to grow. As one of the largest shipping companies in China, these market factors have posed significant impact to the company’s business and hence the performance of the shares,” Sinotrans Shipping said in a release.
According to the company, the trading liquidity of its shares has been at a low level over a period of time which makes it difficult for shareholders to execute on-market disposals without adversely affecting the share price and the company considers that the proposal provides the scheme shareholders with an opportunity to realise their investment in the company for cash at a compelling premium over the prevailing share price.
Sinotrans Shipping has also been considering various strategic alternatives post privatisation, including but not limited to potential restructuring of the privatised assets with its other subsidiaries and associated companies.