Otto Marine says that an investment agreement entered into between OM Offshore Pte Ltd, a wholly-owned subsidiary of the company has been terminated.
Last week Singaporean shipbuilder Otto Marine found a legal loophole to terminate an agreement with the Qidong municipal government to build a shipyard in the port city which is in eastern China.
In a statement, Otto Marine says that an investment agreement entered into between OM Offshore Pte Ltd, a wholly-owned subsidiary of the company, and the government of Qidong City in Jiangsu Province (pictured), dated 12 October 2007, has been terminated as the Chinese party has failed to provide OM Offshore with a suitable piece of land for the shipyard within the timeframe as agreed between the parties.
The deposit paid to the Qidong government under the agreement has been refunded to Otto Marine.
The company says that after thorough consideration, it has decided not to pursue the construction of a shipyard in China at this stage. The company will, however, continue to evaluate other opportunities to expand its shipbuilding business.