November 4, 2008
CIMC takes initial stake in Yantai-Raffles
Container manufacturing giant China International Marine Containers (CIMC) has taken a stake in Yantai Raffles Shipyard Ltd., though, for now, it's somewhat smaller than once planned.
Previously, Yantai Raffles announced that its Chairman and founder Brian Chang had agreed to sell 81.8 million shares in the shipyard, or approximately, 29.9 percent of its issued share capital to a CIMC subsidiary, at $6.92 a share, or some $566 million
Now, says Yantai Raffles, Mr. Chang and CIMC have unanimously agreed that the prior arrangement be revised to approximately 27.36 million ordinary shares representing approximately 10% of YRSL's issued share capital. Under this new agreement, Mr. Chang yesterday sold the shares to the CIMC subsidiary at a price of NOK 16.25 per share. By our reckoning that comes to NOK 444.6 million, or some US$66.9 million.
Mr. Chang subsequently retains a total interest (direct and indirect) in Yantai Raffles of approximately 93 million shares representing approximately 34% of the issued share capital.
Mr. Chang said that "although the percentage shareholding acquired by CIMC in this initial purchase is less than the 29.9% stake originally contemplated, the underlying fundamentals of the transaction remain unchanged. I am delighted with the outcome of this transaction which sees CIMC cement its strategic intent to diversify into the offshore marine industry through YRSL. With these negotiations concluded, we can now further build on realizing the expertise and synergies which CIMC can bring to YRSL to help us reach our common objective of being the best offshore marine yard in China, if not the world, within the next five years."
Mr. Mai Bo Liang, President of CIMC, who is to join the Yantai Raffles board, said, "this initial transaction reflects only the start of CIMC's long-term commitment to YRSL. CIMC strives to be the best at everything it does, and we will be cooperating very closely with YRSL to support its strategic and commercial objectives wherever we can. Our positive outlook on the future of the offshore marine industry remains unchanged, despite these current turbulent times. We believe YRSL provides a very solid framework within which we can together, through mutual cooperation and a sharing of common objectives, grow YRSL into a world-class business."