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Sinotrans to sell stake in wet venture
PostTime:2010-07-30 07:58:56.0 View:16
Internal competition looks set to force Hong Kong-listed Sinotrans Shipping to sell its stake in a joint venture.

The predominantly dry-bulk owner has been given until the end of the year to resolve a potential conflict of interest in the tanker business with Nanjing Tanker Corp (NTC).

Both Sinotrans and NTC are offshoots of parent company Sinotrans & CSC Holdings Co, formed through the 2008 merger with China Changjiang National Shipping (Group) Corp (CSC).

A statement from Sinotrans said: "[NTC] has made an announcement that in order to eliminate competition in the tanker business between [itself] and a joint-venture entity held by [Sinotrans Shipping] and a joint-venture partner of the company, the parent would procure [Sinotrans] to resolve the competition issue before the end of 2010."

Although no deal has been done, Sinotrans says it has already opened discussions with its parent and unnamed partner about selling off its shares. However, no further details were given.

"No binding agreement in relation to the proposed disposal has been entered and no material terms or timetable have been agreed," said Sinotrans.

TradeWinds reported earlier this month that Shanghai-listed NTC is looking to spend up to $750m on VLCC newbuildings at a domestic yard. The owner is said to have already booked four large tankers with another four expected.

Jiangsu-based NTC will take delivery of four VLCCs this year, two each from Dalian Shipbuilding Industry Corp (DSIC) and Bohai Shipbuilding Heavy Industry, both under the umbrella of China Shipbuilding Industry Corp (CSIC).

Its orderbook also includes six medium-range (MR) tankers, three chemical tankers and one coastal oil tanker that will be delivered this year.

NTC has more ships set for delivery next year, including another six VLCCs, according to databases.









Source:Tradewinds Author:By Eoin O?Cinneide London
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