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China Cosco plans logistics arm sale to raise capitalChina Cosco plans logistics arm sale to raise capital

Shanghai: China Cosco Holdings has unveiled plans to sell Cosco Logistics to its parent China Ocean Shipping (Group) Co in a bid to restore its financial stability.

Lee Hong Liang, Asia Correspondent

March 12, 2013

1 Min Read
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China Cosco said the 100% sale of Cosco Logistics would help to improve its financial results in 2013, following two consecutive years of hefty net losses.

The Shanghai and Hong Kong-listed company did not disclose the capital gain from the sale of Cosco Logistics.

Under the terms of the proposed transaction, China Coso will have priority in buying back Cosco Logistics under appropriate conditions in future.

An extraordinary general meeting will be held on 26 April to approve the asset sale to China Shipping.

China Cosco had warned investors of a 2012 full year deficit of $1.5bn. The state-owned firm had suffered a net loss of RMB10.45bn ($1.68bn) in 2011.

Investors are closely watching China Cosco's future given the threat of a stock delisting as the group is undoubtedly going to post a consecutive two-year net loss since 2011.

Shanghai Exchange has labelled China Cosco with a ST (Special Treatment) sign to its stock code, and limited its share prices to move within a 5% range in daily trading, adversely affecting its stock liquidity.

Wei Jiafu, chairman of China Cosco, is already facing pressures by shareholders to step down.

About the Author

Lee Hong Liang

Asia Correspondent

Singapore-based Lee Hong Liang provides a significant boost to daily coverage of the Asian shipping markets, as well as bringing with him an in-depth specialist knowledge of the bunkering markets.

Throughout Hong Liang’s 14-year career as a maritime journalist, he has reported ‘live’ news from conferences, conducted one-on-one interviews with top officials, and had the ability to write hard news and featured stories.

 

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