China: Xiangyu Dredging Purchases New Dredger

Xiangyu Dredging Holdings Limited has announced that the wholly owned subsidiaries Xiangyu PRC and Jiangsu Xingyu have entered into a purchase agreement with Zhongchuan Transport.

Pursuant to the Contract, Xiangyu Dredging agreed to purchase Zhongchuan No. 9, a 2713 tons cutter suction dredger, at the purchase price of RMB285 million. The dredger will be used for the Company’s recent project in Shandong province as well as future projects. It is supposed to further expand the Company’s business and enhance the Group’s overall competitiveness.

The port of registry of the purchased Zhongchuan No.9, which is a cutter suction dredger, is located in Yancheng city, Jiangsu Province. It has a gross tonnage of 2,713 tonnes with hourly dredging capacity of 3500 cubic metres and over 10 kilometers dredging distance. Its main components are all imported from overseas.

Following the success of acquiring two dredgers last year, the Group once again chose to acquire the secondhand dredger, which has not only enhanced the Group’s capacity and ship deployment capability, but has also optimized dredging distance and promoted the diversity of fleet structure.

After transferring the ownership of the dredger, the dredger could be put into operation immediately. It will reduce the proportion of chartered equipments and therefore reduce the Group’s operational cost.

By grasping a good purchasing opportunity, the Group chose to purchase the long discharging distance dredger, which well indicates the Group’s confidence in the industry’s long term development, the development of its business, paving the way for its long term development in the near future. Looking forward, the Group will keep expanding its business steadily and purchase relevant equipments according to the market environment and projects’ conditions.

Yancheng Zhongchuan Transport Company Limited, a limited company approved by local Industry and Commerce Administration, is a professional water transport company whose main businesses include freight, dredging, salvage, construction and installation.

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Press Release, October 22, 2012