SITC International spends over US$100 million buying ships and containers from associate

SITC Cagayan / Source: VesselFinder

SITC International Holdings, the holding company of Hong Kong-based intra-Asia carrier SITC Container Lines, said on 21 September that it will spend over US$100 million to buy five existing ships and two newbuildings from an associated company.

The associate, SITC Investment, is a British Virgin Islands-incorporated entity owned by SITC Maritime Group, a China-registered private company owned by SITC Maritime Group, which is held by SITC International chairman Yang Shaopeng.

Built between 2000 and 2008, the existing ships comprising, SITC Danang, HF Spirit, HF Fortune, HF Lucky and HF Wealth, are feeder vessels of individual capacities ranging from 1,032 TEU to 1,049 TEU. SITC International will pay SITC Investment US$39.77 million for these.

SITC International will also purchase a pair of 1,800 TEU ships, HF Changde and HF Haode, now under construction at Huanghai Shipbuilding, for US$18.44 million. The outstanding sum of US$41.94 million due to Huanghai will be paid by SITC.

In addition, a Panama-incorporated associate, Hai Lian Shipping Enterprises, 200 20-foot flat racks and 500 40-foot flat racks built in 2018.

SITC International said the purchases will increase its directly owned fleet and equipment.

The company elaborated, “The group has been chartering vessels and containers held by the target companies in order to meet its operational requirements. The acquisitions will enable the group to expand its self-owned fleet, as well as owning its own shipping containers to carry out its shipping operation, thereby reducing the number of connected transactions in its ordinary course of business. By operating its own fleet of vessels and shipping containers, the group aims to streamline its shipping operation, reduce reliance on related parties, and enhance its operational efficiency and resource utilisation.

Furthermore, vessel prices have experienced swift decline following the Covid-19 pandemic, which presents an opportunity for the group to optimise its fleet structure and secure a long-term cost-competitive position in the shipping industry.”

Martina Li
Asia Correspondent

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