<\/p>\n
Yangzijiang Shipbuilding plans to pay US$825.7 million to take a 10% stake in a key customer, charter owner Seaspan Corporation, which has been giving it shipbuilding orders for around two decades.<\/p>\n
According to Yangzijiang, this acquisition will \u201cfurther strengthen\u201d its \u201cstrategic relationship\u201d with Singapore-based Seaspan and \u201csupport closer long-term collaboration\u201d.<\/p>\n
Yangzijiang says that by owning this stake in this regular customer, it \u201cenhances alignment\u201d between vessel demand and its production planning and yard development strategy.<\/p>\n
In addition, Yangzijiang will gain closer access to end-market dynamics, gather better market intelligence and be more responsive to customer demand.<\/p>\n
The deal is also seen as a way to use Yangzijiang\u2019s surplus funds in a \u201clong-term strategic investment with relatively stable return characteristics.\u201d<\/p>\n
This acquisition is part of a bigger deal where shareholders of an entity called Poseidon Corp are selling 34% of the stake to other investors. Seaspan is an indirect subsidiary of Poseidon. It owns the world\u2019s largest containership fleet of 227 vessels with a total carrying capacity of 2.4 million TEU.<\/p>\n
In parallel and in conjunction to this deal, Hengyuan Asset Investment, a privately held entity controlled by Ren Letian, executive chairman of Yangzijiang, is taking a 5% stake.<\/p>\n
In its SGX announcement, Yangzijiang notes that the book value of its 10% stake to be acquired is US$459 million as at Dec 31 2025, and that the NTA is around US$452 million.<\/p>\n
Citing a valuation done by Kroll, the interest is valued at US$660.6 million to US$810.9 million.<\/p>\n
According to Yangzijiang, it believes the premium it is paying over valuation is justified as it takes into account \u201cthe broader strategic and commercial benefits\u201d of \u201clong-term alignment with a significant customer\u201d.<\/p>\n
In a pro forma basis, assuming the acquisition was completed on Jan 1 2025, Yangzijiang\u2019s profit per share would have improved to RMB2.3219, from RMB2.1923.<\/p>\n
Yangzijiang will pay for this deal entirely using its own cash. Upon completion of the deal, it expects to remain in a net cash position.<\/p>\n
Yangzijiang Shipbuilding shares closed at $4.05, down 1.22%.
Source: The Edge Singapore<\/p>\n
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