LEADING INTERNATIONAL MARITIME MAGAZINE

Sembcorp Marine to sell its stake in Cosco Shipyard

The Board of Directors of Sembcorp Marine Limited has entered into a sale and purchase agreement with China Ocean Shipping (Group) Company (COSCO) to dispose of its 30% equity interest in Cosco Shipyard Group Co., Ltd (CSG).

CSG is a ship repair, conversion and shipbuilding group in China which owns six major shipyards that are located in the key coastal cities stretching from Dalian in the north, Nantong, Shanghai, Qidong and Zhoushan in the centre, to Guangzhou in the south. Sembcorp Marine first announced its acquisition of the 30% stake in CSG in 2004.

Following completion of the sisposal, Sembcorp Marine will cease to have any interest in CSG except via its 4.98% shareholding in Cosco Corporation (Singapore) Ltd, which in turn has a 51% equity interest in CSG.

The aggregate consideration of RMB1,059.23 million (approximately S$220.68 million) for the disposal was arrived at after taking into account the value of CSG as at 31 October 2016. The net proceeds (after deducting capital gains tax and realisation of foreign currency translation reserves) represent a gain of approximately S$48.32 million over the carrying value of the investment in CSG of S$180.10 million.