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JIN - DISPOSAL OF A VESSEL
The Board of Jinhui Shipping and Transportation Limited announces that a wholly-owned subsidiary
of the Company entered into a memorandum of agreement on 2 December 2025 for the disposal of
a Supramax at consideration of US$14,400,000.
THE DISPOSAL OF THE VESSEL
The Vendor entered into the Agreement with the Purchaser on 2 December 2025 for the disposal of
the Vessel at a consideration of US$14,400,000. The Vessel will be delivered by the Vendor to the
Purchaser between 15 December 2025 and 30 January 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 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 Xing Le Investments Limited, a company incorporated in Hong Kong, principally
engaged in shipping operations.
To the best of the Board’s knowledge, information and belief having made all reasonable enquiry,
the Purchaser is an independent third party not connected with the directors, chief executive or
substantial shareholders of the Company or its subsidiaries or any of their respective associates.
Vessel
The Vessel is a Supramax of deadweight 56,361 metric tonnes, built in year 2012 and registered in
Hong Kong. The Vendor warrants that the Vessel, at the time of delivery, is free from all charters,
encumbrances, mortgages and maritime liens or any other debts. The Vessel will be delivered to the
Purchaser on a free from charter basis.
The Vessel has been owned by the Group since year 2012, and its unaudited net book value as at
31 October 2025 was approximately US$13,218,000. The net profit both before and after taxation
and extraordinary items attributable to the Vendor for the financial year ended 31 December 2024
JINHUI SHIPPING AND TRANSPORTATION LIMITED
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was approximately US$1,721,000 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 US$1,108,000.
Consideration
Under the Agreement, the Vendor agrees to dispose of the Vessel for a consideration of
US$14,400,000 payable by the Purchaser as follows:
(1)
an initial deposit of US$1,440,000 will be payable by the Purchaser within five banking days
after the date that (i) signing of the Agreement; (ii) signing of the 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$5,960,000 will be payable by the Purchaser within two banking
days prior to the delivery of the Vessel which will take place between 15 December 2025
and 30 January 2026; and
(3)
the outstanding balance of US$7,000,000 will be payable by the Purchaser in sixteen
quarterly installments. 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 6.90% 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 such information 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$14.2 million as at 19 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.
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Possible financial effects of the Disposal of the Vessel
The unaudited net book value of the Vessel as at 31 October 2025 as described above, the Group
would realize a book gain of approximately US$1.2 million on the Disposal of the Vessel. The actual
book gain 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. The Directors consider the terms and conditions of the Agreement were
concluded and agreed between parties on normal commercial terms following arm’s length
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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.
DEFINITIONS
In this announcement, unless the context requires otherwise, the following expressions of the
following meanings were used:
“Agreement”
the memorandum of agreement dated 2 December 2025 entered into
between the Vendor and the Purchaser in respect of the disposal of the
Vessel;
“Board”
the board of Directors;
“Company”
Jinhui Shipping and Transportation Limited;
“Directors”
the directors of the Company;
“Disposal of the Vessel”
the disposal of the Vessel under the Agreement;
“Group”
the Company and its subsidiaries;
“Hong Kong”
the Hong Kong Special Administrative Region of the People’s
Republic of China;
“Purchaser”
Xing Le Investments Limited, a company incorporated in Hong Kong;
“Vendor”
Jinbi Marine Inc., a wholly-owned subsidiary of the Company; and
“Vessel”
a deadweight 56,361 metric tonnes bulk carrier “JIN BI” registered in
Hong Kong.
By Order of the Board
Ng Kam Wah Thomas
Managing Director
2 December 2025
