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COSCO International Acquires JOP to Expand Marine Coating Business

Published on 2004-11-08. Author : SpecialChem

 

COSCO International Holdings Limited ("COSCO International" or "the Company") (SEHK Stock Code: 0517) announced today that it had entered into a share transfer agreement (the "Agreement") with Guangzhou Economy & Technology Development Zone COSCO Marine Service Co. Limited ("CMSC") to acquire 49% equity interest in Guangzhou Jotun Ocean Paint Co. Ltd., ("JOP") from CMSC for a cash consideration of RMB17.31 million (the "Acquisition"). The signing ceremony was successfully held in Guangzhou Ocean Hotel this afternoon.

Mr. Liu Guoyuan, President of COSCO (Hong Kong) Group Limited and Vice-Chairman of COSCO International, Mr. Zhou Liancheng, Vice-President of COSCO (Hong Kong) Group Limited and Executive Director of COSCO International, Mr. Liu Hanbo, Vice-President of COSCO (Hong Kong) Group Limited and Managing Director of COSCO International and Mr. Xu Huixing, Managing Director of COSCO Guangzhou Shipping Company (“COSCO Guangzhou Shipping") attended the signing ceremony.

Mr. Liu Guoyuan, Vice-Chairman of the Company, said after the ceremony,"in accordance with the strategic planning of China Ocean Shipping (Group) Company ("COSCO") on consolidating COSCO's coating business, and the guiding principle of COSCO International’s business positioning by relying on the development of shipping industry and ship trading and supplying services businesses, under the leadership and co-ordination of COSCO and with tremendous support of sister companies, COSCO International has gradually succeeded in consolidating coating assets as planned and has achieved its effectiveness. Today, we signed the Agreement to acquire 49% equity interest in JOP with the great support of COSCO Guangzhou Shipping. It is of utmost significance on further collaboration with international renowned coating manufacturer and the implementation of COSCO's business development strategy."

JOP is a joint venture between Jotun A/S ("Jotun"), an international well-known coating manufacturer and CMSC, a wholly-owned subsidiary COSCO in China. JOP is a manufacturing base of Jotun in China. It is principally engaged in the manufacturing and sales of marine coating, protective coating and decorative paint, among them marine coating is the major business. Jotun is a famous international marine coating manufacturer as well as one of the major market participants in the marine coating market in China. As at 31st December 2003, JOP recorded a sales income of RMB 224 million and a profit before taxation of RMB 18 million, which has been ranked as one of the leading marine coating manufacturers in China.

The Acquisition will be financed by internal sources of the Company. As CMSC is a subsidiary of COSCO, which is a connected person of the Company, the Acquisition constitutes a discloseable and connected transaction for the Company under the Listing Rules. A special general meeting will be convened in mid December 2004 and independent shareholders of the Company will be invited to review and approve the transaction.

"In early September 2004, we had signed a non-legally binding letter of intent with Jotun, laying down the understanding and foundation for future comprehensive business collaboration with Jotun in the marine coating in China. We believe that leveraging from the enormous strength of COSCO Group in shipping industry, coupled with the technical expertise as well as well-established distribution network of Jotun in the marine coating, it will complement the advantages of both parties through giants alliance and achieve the aim of mutual development. In addition, COSCO coating business platform will be expanded and it will create more room for profit growth in the future development of the Company, so as to bring substantial returns to the shareholders." Mr. Liu Guoyuan concluded.

Source: COSCO International


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