China COSCO to Sell Subsidiary to China Ocean Shipping
China Cosco plans to sell Cosco Logistics to state-backed parent company China Ocean Shipping.
The unit may be valued at about seven billion yuan, and the company is also considering selling other assests to China Ocean to raise as much as an additional 20-billion yuan, reports the South China Morning Post.
Shares in China Cosco fell after the logistics sale was announced, on concern that divesting the profitable unit would undermine earnings over the longer term. Tianjin-based China Cosco faces possible restrictions on its Shanghai-traded shares after warning of a "significant" loss for 2012, amid falling freight rates and rising fuel costs. Gains from asset sales may help China Cosco avoid a third straight annual deficit.
Source: South China Morning Post