Hutchison Whampoa to increase its stake in a Shenzhen port from 41.67 pct to 65 pct
Hutchison Whampoa will pay 270.63 million yuan (HK$280 million) to increase its stake in a Shenzhen port venture from 41.67 percent to 65 percent, putting it in control of one of the fast-growing Chinese ports that have been stealing the limelight from Hong Kong.
Hutchison bought the 23.33 percent stake in Shenzhen Yantian West Port Co from its joint-venture partner, Shenzhen Yantian Port Holdings, according to an announcement on the Shenzhen stock exchange.
The purchase will reduce the Shenzhen partner's stake to 35 percent from 58.33 percent.
The holding company's board has endorsed the stake sale, but the deal still requires approval by the Shenzhen State Assets Management Commission, the firm's controlling shareholder, the announcement said.
Market sources told Sing Tao Daily, the sister paper of The Standard, that the Yantian West Port requires more money to be invested in order to fully develop the large site where the port is situated.
The sources said Shenzhen Yantian Port Holdings does not want to inject more money into the project, but Hutchison is willing, which is why it enlarged its stake.
The joint venture reported profit of 6.59 million yuan last year.
Hutchison's various ventures at the deepwater Yantian port were among the top contributors last year to throughput growth in its port division.
Throughput at the Yantian port grew 17 percent in 2006 to 8.865 million twenty-foot equivalent units, compared to 5 percent growth for the Kwai Tsing terminals in Hong Kong. The Yantian port reported earnings before interest and taxes grew 10 percent last year. No specific breakdown was available for the west port joint venture.
Hutchison shares closed yesterday at HK$75.50, slipping 0.1 percent.
Hutchison bought the 23.33 percent stake in Shenzhen Yantian West Port Co from its joint-venture partner, Shenzhen Yantian Port Holdings, according to an announcement on the Shenzhen stock exchange.
The purchase will reduce the Shenzhen partner's stake to 35 percent from 58.33 percent.
The holding company's board has endorsed the stake sale, but the deal still requires approval by the Shenzhen State Assets Management Commission, the firm's controlling shareholder, the announcement said.
Market sources told Sing Tao Daily, the sister paper of The Standard, that the Yantian West Port requires more money to be invested in order to fully develop the large site where the port is situated.
The sources said Shenzhen Yantian Port Holdings does not want to inject more money into the project, but Hutchison is willing, which is why it enlarged its stake.
The joint venture reported profit of 6.59 million yuan last year.
Hutchison's various ventures at the deepwater Yantian port were among the top contributors last year to throughput growth in its port division.
Throughput at the Yantian port grew 17 percent in 2006 to 8.865 million twenty-foot equivalent units, compared to 5 percent growth for the Kwai Tsing terminals in Hong Kong. The Yantian port reported earnings before interest and taxes grew 10 percent last year. No specific breakdown was available for the west port joint venture.
Hutchison shares closed yesterday at HK$75.50, slipping 0.1 percent.
