Hong Kong’s China Merchants Port Holdings Company Limited (CMPort) has decided to sell its stake in its indirectly owned unit, Shenzhen Chiwan Wharf Holdings Limited.
As informed, CMPort is expected to record a net gain from the disposal of HKD 3.88 billion (USD 496.3 million).
On February 5, 2018, subsidiaries of CMPort and China Merchants Group (CMG) entered into two share purchase agreements. CMPort agreed to dispose of 25% of the total issued share capital in A shares and 8.58% of the total issued share capital in B shares of Chiwan Wharf for HKD 5.01 billion and HKD 738.44 million, respectively.
On the same day, China Nanshan Development (Group) Incorporation, in which CMPort indirectly holds approximately 37%, inked a share purchase deal with CMG. China Nanshan agreed to sell 32.52% of the total issued share capital in A shares of Chiwan Wharf to CMG for HKD 6.51 billion.
Upon completion, CMPort will no longer have any interests in Chiwan Wharf, and the related entrustment agreements will terminate accordingly, the company said.
With the disposal, CMPort intends “to resolve competition issue” and “unlock value of its investment in Chiwan.”
“CMPort always optimizes its asset structure by implementing the company’s development strategy, with the goal to enhance the synergy of projects in order to reduce cost and increase efficiency,” Bai Jingtao, Managing Director of CMPort, said.
“After the transaction, CMPort will still maintain its stakes in five port assets in Western Shenzhen area and continues to be a major investor in Western Shenzhen terminals,” Jingtao added.
Chiwan, which provides logistics, container terminal and port management services, holds stakes in each of Chiwan Container Terminal, Shenzhen Chiwan Harbour Container and the Mawan companies. It also has interests in operations in general and bulk cargo terminals businesses.