COSCO Disposes 14 Vessels

China COSCO Holdings Company Limited has announced decommissioning and disposing of fourteen of its vessels.

References are made to the announcements of the Company dated 16 January 2014 and 29 January 2015 in relation to, among other things, the resolutions of the board of directors of the Company approving the Company’s implementation plans to decommission and dispose of aged vessels in 2014 and 2015.

The Board informed that the Group had disassembled fourteen vessels, including one container vessel (Daqing He) and thirteen bulk carriers (Fenjin Hai, Songshan Hai, Huangshan Hai, Gang Ming, Taishun Hai, Shouning Hai, Taihua Hai, Tiansheng Hai, Yichang Hai, Dongchang Hai, Yi Jia, Dengzhou Hai and Peng Xin) from 1 February 2015 to 31 March 2015.

The Vessels, with the aggregate capacity of 924,700 deadweight tons, were disposed of as scrapped vessels to different purchasers, all of which are independent third parties of the Company, at a total consideration of approximately RMB211 million.

According to the unaudited financial results of the Company for the month ended 31 March 2015, realised losses incurred from the disassembly of the Vessels amounted to approximately RMB72 million.

WYEC Cosco
Image for representation purpose only; Courtesy of COSCO

The decommissioned container vessel was previously owned by COSCO Container Lines Co., Ltd.*, a wholly-owned subsidiary of the Company, and the decommissioned bulk carriers were previously owned by China COSCO Bulk Shipping (Group) Company Limited* (“COSCO Bulk”), a wholly-owned subsidiary of the Company.

As a result of the decommissioning of the Vessels, the average age of vessels owned by COSCON and COSCO Bulk has decreased, while the oil saving level and overall environmental friendliness of the vessels have improved.

The Board considers that the decommissioning of the Vessels is conducive to enhancing the overall operational competitiveness of the shipping fleet of the Company and is in the interest of the Company and the Shareholders as a whole.

The Company will keep its Shareholders and potential investors informed of further development in connection with its plan to decommission aged vessels by way of further announcement(s) as and when appropriate or necessary.

Reference: COSCO Press Release

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