Guangzhou Shipyard selling three non-core assets for $185m

Public tenders will be held to offload GSI’s property and industrial land assets, and the transaction will be conducted by the Shanghai United Assets and Equity Exchange.

The assets include Hongfan Hotel, Guangzhou Jinzhou and Guangzhou Shipyard Industrial. The minimum consideration for the sale is RMB120.97m, RMB33.8m and RMB973.79m, respectively.

While both Hongfan Hotel and Guangzhou Jinzhou will be sold at their valuation prices, Guangzhou Shipyard Industrial is going for a much higher price over its valuation of RMB413.79m.

GSI said “the directors is of the view that the disposal is conducive to optimising the group’s assets structure” and the net proceeds from the disposal will be used as working capital.

GSI has been struggling to achieve financial stability and its parent firm China State Shipbuilding Corporation (CSSC) is implementing a significant assets restructuring of the company.

Shares of Hong Kong-listed GSI have been suspended from trading since 8 April this year and it is expected that the trading will resume no later than 15 November 2014.

As part of the restructuring plan, CSSC will allow GSI to take full control of its sister firm Huangpu Wenchong Shipbuilding Company via an equity transfer deal.