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Hong Kong - 24 November 2025
The Board announces that on 24 November 2025 (after the trading hours), the Vendor, an approximately 55.69% indirect subsidiary of the Company, entered into the Agreement with the Purchaser in respect of the disposal of the Vessel at a consideration US$10,300,000 (approximately HK$80,340,000). The Vessel will be delivered by the Vendor to the Purchaser between 1 December 2025 and 28 February 2026.
As one or more applicable percentage ratios calculated in accordance with Rule 14.07 of the Listing Rules in respect of the Disposal of the Vessel exceed 5% but are less than 25%, the Disposal of the Vessel constitutes a discloseable transaction of the Company and is therefore subject to the reporting and announcement requirements under Chapter 14 of the Listing Rules.
The Disposal
The Board announces that on 24 November 2025 (after the trading hours), the Vendor, an approximately 55.69% indirect subsidiary of the Company, entered into the Agreement with the Purchaser in respect of the disposal of the Vessel at a consideration US$10,300,000 (approximately HK$80,340,000). The Vessel will be delivered by the Vendor to the Purchaser between 1 December 2025 and 28 February 2026.
Information on the parties
The Company and the Group
The principal activity of the Company is investment holding and the principal activities of its subsidiaries are international ship chartering and ship owning.
Vendor
The Vendor is a ship owning company and a wholly-owned subsidiary of Jinhui Shipping, which is in turn an approximately 55.69% indirect subsidiary of the Company as at date of this announcement. The principal activities of the Vendor are ship chartering and ship owning. The Vendor is a special purpose company solely for holding the Vessel.
Purchaser
The Purchaser is Forever Win Shipping Limited, a company incorporated in Hong Kong, principally engaged in shipping operation. The majority interest in the Purchaser is held by Zhang Wei and Zhao Jie, who are the ultimate beneficial owners of the Purchaser.
To the best of the Board's knowledge, information and belief having made all reasonable enquiry, the Purchaser and its ultimate beneficial owner are Independent Third Parties.
Consideration
Under the Agreement, the Vendor agrees to dispose of the Vessel for a consideration of US$10,300,000 (approximately HK$80,340,000) payable by the Purchaser as follows:
(1) an initial deposit of US$1,030,000 (approximately HK$8,034,000) will be payable by the Purchaser within three banking days after the date that (i) the signing of the Agreement; (ii) the signing of escrow agreement; and (iii) the confirmation from the escrow agent confirming the account is ready to receive the initial deposit;
(2) the first installment of US$4,270,000 (approximately HK$33,306,000) will be payable by the Purchaser within two banking days prior to the delivery of the Vessel which will take place between 1 December 2025 and 28 February 2026; and
(3) the outstanding balance of US$5,000,000 (approximately HK$39,000,000) will be payable by the Purchaser in twelve quarterly installments. Each of the first eleven installments shall be in an amount of US$410,000 (approximately HK$3,198,000), and the last installment shall be in an amount of US$490,000 (approximately HK$3,822,000). The first installment will become payable three months following the delivery of the Vessel. Interest on the outstanding amount will accrue at a rate of 7.50% per annum, calculated over three-month interest periods commencing from the date of delivery of the Vessel. Interest shall accrue daily, based on a 365-day year, and shall be calculated for the actual number of days elapsed (inclusive of the first day and exclusive of the last). All accrued interest is payable on the relevant installment payment date and was concluded based on arm's length negotiations and was on normal commercial terms.
To secure the Purchaser's performance and observance of and compliance with all of the covenants, terms and conditions under the Agreement, including the due payments of the outstanding amount and any other sums owes by the Purchaser, the Purchaser shall create a first priority Hong Kong ship mortgage of the Vessel in favour of the Vendor and enter into certain security documents in the form and substance satisfactory to the Vendor.
The consideration of the Vessel was determined by reference to market intelligence. The Company has gathered from shipbrokers and its own analysis of recently concluded sale and purchase transactions of vessels of comparable size and year of built in the market, valuation from independent valuer and on the basis of arm's length negotiations with the Purchaser.
In the course of negotiating the consideration of the Vessel, the Group obtained indicative valuation of the Vessel from Arrow Valuations, an independent valuer and an affiliate of Arrow Asia Shipbrokers Ltd., an independent shipbroking group. The appraised value of the Vessel from Arrow Valuations was US$10 million (approximately HK$78,000,000) as at 13 November 2025. The market approach has been adopted in the valuation of the Vessel. In the process of gathering the market intelligence from shipbrokers, we receive market information on the sale and purchase market of second-hand vessels on a daily basis from international shipbrokers. We also discuss with international shipbrokers frequently to gather market intelligence on what vessels are being put on the market for sale and purchase, which parties are looking to buy or sell their vessels on a worldwide basis. However, as each vessel is never identical, management has based on the experiences and market knowledge to consider and come up with the acceptance of the offer.
Vessel
The Vessel is a Supramax of deadweight 56,968 metric tonnes, built in year 2008 and registered in Hong Kong. The Vessel has been owned by the Group since year 2008, and its unaudited net book value as at 30 September 2025 was approximately HK$84,688,000. The net profit both before and after taxation and extraordinary items attributable to the Vendor for the financial year ended 31 December 2024 was approximately HK$19,832,000 whereas the net loss both before and after taxation and extraordinary items attributable to the Vendor for the financial year ended 31 December 2023 was approximately HK$18,972,000.
Possible financial effects of the Disposal of the Vessel
The unaudited net book value of the Vessel as at 30 September 2025 as described above represents the estimated recoverable amount which was based on the value in use under the requirement of Hong Kong Accounting Standard 36 Impairment of Assets. The Group would realize a book loss of approximately HK$4.4 million on Disposal of the Vessel. The actual book loss which the Group would realize upon completion of the Disposal of the Vessel will depend on the actual net book value of the Vessel in accordance with the Group's impairment and depreciation policy for its vessels as shown in the Company's annual report and the actual costs of disposal being incurred of the Vessel as at date of delivery.
Use of proceeds
The net sale proceeds from the Disposal of the Vessel will be applied toward general working capital purposes. Specifically, the Company will utilize the funds to repay short-term borrowings, thereby reducing interest expenses and improving its capital structure. A portion of the proceeds will be used to settle outstanding creditors and payables. To enhance financial flexibility, part of the proceeds will be retained as a liquidity buffer and reserve for any unforeseen expenditure or market fluctuations.
Reasons For The Disposal Of The Vessel
The Group's principal activities are international ship chartering and ship owning. The Directors continuously review the prevailing market conditions of the shipping industry and monitor and adjust the Group's fleet profile as appropriate. The Disposal of the Vessel is in line with the ongoing strategy of the Group to optimize its vessel fleet by maintaining a well-balanced portfolio of the vessel fleet and reduce our operational risk exposures in current volatile markets. The Disposal of the Vessel will enable the Group to enhance its working capital position and further strengthen its liquidity and overall financial position.
The Group operates a balanced and diversified fleet of dry bulk carriers, comprising Capesize, Panamax, Ultramax and Supramax bulk carriers. To stay competitive in the market, the Group focused on enhancing the quality of our fleet and adjusting our fleet profile, particularly in terms of seeking to lower the overall age profile of our fleet. We believe in being prepared at all times for future possible opportunities of redeployment of capital into other more suitable assets that may arise going forward while keeping leverage at comfortable levels.
Looking ahead, we will continuously monitor the market as well as our operations going forward and look out for opportunities to maintain a reasonably modern and competitive fleet, not ruling out any future disposal of smaller and older vessels and replace with newer vessels or charter-in of vessels. We will make such decisions on an ad hoc basis to maintain high financial flexibility and operational competitiveness.
The Group currently operates a fleet of twenty six vessels, of which twenty are owned vessels (including the Vessel) and six are chartered-in vessels, with total deadweight carrying capacity of approximately 2 million metric tonnes. Among the owned vessels were two that have been arranged under sale and leaseback agreements and one which has been disposed of and reclassified under assets held for sale.
The Directors believe that the Disposal of the Vessel will not have any material adverse effect on the operations of the Group. Directors consider the terms and conditions of the Agreement were concluded and agreed between parties on normal commercial terms following arm's length negotiations with reference to the prevailing market values. The Directors are of the view that the projected operational results of the Vessel are not necessarily an indicator of its future potential performance, which in turn is not directly pertinent to the negotiation of the consideration. During negotiation regarding the consideration of the Vessel, a market-based approach was adopted, as it provides a fair and reliable current situation of valuation, for both the Vendor and the Purchaser. The Directors consider such terms and conditions are fair and reasonable and believe that the Disposal of the Vessel is in the interests of the Company and its shareholders as a whole.
Jinhui Holdings Company Limited - press release
