Da Chuan Heavy Industries receives order for 7 8800TEU container ships

2013-07-06 09:25

CIMC Group announced on April 4 that its wholly-owned subsidiary, CIMC Leasing Hong Kong Limited, signed a container ship construction contract with Dalian Shipbuilding Industry Group Co., Ltd. to build seven 8,800 TEU container ships. The contract price for each ship is US\$85 million (approximately RMB 525 million), with a total contract value of approximately RMB 3.675 billion. This is the company's second foray into shipbuilding.

On the same day, CIMC Leasing Hong Kong signed a container ship financing lease contract with a subsidiary of MSC Mediterranean Shipping Company SA, with a term of 204 months. MSC, headquartered in Geneva, Switzerland, is the world's second-largest shipping company.

According to the above contracts, CIMC Leasing Hong Kong will first purchase the seven ships from Dalian Shipbuilding and then lease them to a subsidiary of MSC. The delivery time is expected to be as early as the second quarter of 2015. In this project, CIMC Leasing Hong Kong's revenue will mainly come from ship rental and the final residual value buyout. The daily rent for each ship is US\$25,000; upon expiration of the lease agreement, the MSC subsidiary will purchase all ships at US\$21.5 million per ship.

As the world's largest container manufacturer, this is CIMC Group's second venture into the ship leasing industry. On September 22, 2012, CIMC Group announced that it would invest RMB 5.2 billion to build 10 new ultra-Panamax container ships. After delivery in 2014, these 10 ships will be operated by the third-largest liner company, CMA CGM, through financing leases.