Asia/Pacific News
Chinese Shipyard Raising Funds for Modern Ships
Shanghai shipbuilder Sainty Marine plans to raise RMB 1.6 billion ($260 million) through a new issue of 187 million shares to specific investors, mainly to fund the construction of new modern and dual-fuel ships, Chinese shipping news site SinoShip News reports.
The company said RMB 1.3 billion ($211 million) of the money will pay for construction of 16 vessels ordered by Precious Shipping and four dual-fuel containerships for Universal Marine.
Sainty Marine announced earlier this year that it expected a net loss of RMB 230 million ($37.3 million) for the first half of the year, and it has had a hard time getting bank financing.
The company has received a number of newbuild orders this year, which are expected to keep it busy until 2018.
Traditional bank financing of shipbuilding dropped sharply after the 2008 crash in the shipping markets, and alternative sources of funding like private equity have been filling the gap, although some industry players worry this could exacerbate overcapacity problems.
