Shanghai Bestway’s deal for 200 LNG-powered bulkers faces financing issues

In early August, Shanghai Bestway announced a RMB650m ($105.8m) deal to design and procure the 200 ships for affiliated firm Green Power Water Transport Company, to be built at affiliated yard Dajin Heavy Industries.

However, Green Power Water Transport has failed to make the first payment of RMB130m to Shanghai Bestway. The payment is now late by about one month as it was supposed to be made within the first week of signing the contract, putting the deal at risk of a cancellation.

Ma Rui, board secretary of Shanghai Bestway, said there have been some disagreements among the shareholders of Green Power Water Transport. “The company is trying to resolve the disagreements. If there is any progress made on the contract, there will be an immediate announcement,” he was quoted saying.

Green Power Water Transport, established in May this year, is 25% owned by Shanghai Bestway and 10% controlled by another wholly-owned subsidiary of Shanghai Bestway.

The 200-LNG-powered vessels comprise of 100 units of 600-dwt bulkers, 50 units of 800 dwt bulkers and another 50 units of 1,000 dwt bulkers, all scheduled for delivery by March 2015.