Chinese shipbuilder puts operations on hold

AUGUST 21, 2015 — Singapore listed Chinese shipbuilder JES International Holdings Limited said yesterday that its various businesses have ceased operations and production but that it is currently maintaining a skeletal staff as it tries to sort out its various woes.

It is trying to put a restructuring deal together and get it through the Chinese court system, but its problems include missing “group paraphernalia,” such as the administrative records and corporate seals of various subsidiaries, and it is embroiled in police and legal proceedings against various former personnel.

There’s also a family drama at play here.

JES International says that missing financial records are being held by what it calls “the JX Associates,” relatives of its former chairman and CEO, Jin Xin. JES has taken legal action against its former administrative officer Ju Li who is alleged to have absconded with the group paraphernalia following the resignation of Jin Xin in March this year.

Jin Xin is the father of JES International’s current CEO Audrey Jin Yu, whose mother Chu Caixia was appointed as non-executive Chairman in May.

Yesterday, the company said that it had successfully obtained the administrative records and common seals of two of its subsidiaries, JEHI and Jiangsu New Eastern Marine Engineering Equipment Co., Ltd, but was still in the process of replacing the rest of the missing paraphernalia of Jiangsu Nereus Shipyard Co., Ltd, JYJJP Eastern Shipyard Supplies Co. Ltd and Jingjiang Eastern Heavy Steel Structure Co, Ltd.

The group has also lodged a police report with the local authorities in the PRC against the JX Associates for recovery of the missing financial records of the group’s subsidiaries, but the electronic financial records  have been recovered and are currently in the custody of the police. The paper financial records of two subsidiaries are currently in the possession of the local PRC courts followings requests for them made by national and local tax authorities.

The company says it has already commenced negotiation with potential investors and its creditors on the restructuring proposal to be submitted to the Jiangsu High Court in the event that its application is decided in in favor