Cosco Shipping Development (CSD), the financing arm of state giant China Cosco Shipping, has agreed to sell its stake in a loss-making e-commerce firm to a group affiliate.
In an exchange filing, Shanghai- and Hong Kong-listed CSD said it would sell 25% in E-Shipping to Cosco Shipping Logistics—wholly owned by Cosco Shipping—for CNY 13.2m ($1.97m).
Explaining the reasons behind the divestment, CSD said: “The group has transformed from a container liner operator into an integrated financial services platform and has since been focusing on the provision of integrated financial services with diversified leasing businesses.”
“The principal business of E-Shipping, being supply chain management, is not in line with the existing principal businesses and future development of the Group.”
“The disposal will enable the Group to focus on its principal businesses and develop into an integrated shipping financial service platform.”
Shenzhen-based E-Shipping, whose main business is related to supply chain management, recorded after-tax losses of CNY 3.45m on revenues of CNY 27.6m in the first quarter of 2018. The company also posted after-tax losses for 2016 and 2017.
As of 31 March 2018, the audited net asset value of E-Shipping amounted to CNY 3.75m.
