Sinotrans Changjiang spends $11m on boxship trio
Sinotrans Changjiang, which was created earlier this year following the merger of leading freight forwarder Sinotrans with domestic shipping company China Changjiang National Shipping, has splashed out almost Yuan78.8m ($11.6m) for three 303 teu boxships.
The vessels have been ordered from an associate of Sinotrans shipbuilding company, Purple Mountain Shipyard, based in Nanjing in eastern China's Jiangsu province.
As part of the deal, Sinotrans and its parent company have provided two loans to Sinotrans Changjiang to finance the shipbuilding order. Sinotrans has agreed to provide Yuan40.8m, while the parent, which owns a 57.9% stake in the Hong Kong-listed company, will lend Yuan39.2m.
The loan provided by Sinotrans will be funded by the group company.
Both advances will carry an interest rate of 5.94% and will be repaid by Sinotrans Changjiang in eight equal installments between 2011 and 2018.
Work on the first of the three ships is expected to start next Monday for completion in about 10 months. Construction of the other two vessels is set to begin in May.
Sinotrans said the ships will be deployed on feeder services on the Yangtze river between Wuhan and Shanghai"s Yangshan deepwater port.
Company secretary Gao Wei said the ships would also lower shipping costs while helped to expand market share for Sinotrans Changjing.