Investment In Tower A

Jinhui Shipping and Transportation

28/05/2020 07:54

May 28 (Reuters) - Jinhui Shipping And Transportation
Limited  JINS.OL :
    * UPDATES ON CO-INVESTMENT IN BUSINESS PROPERTY IN SHANGHAI,
TOWER
A
    * INVESTMENT MANAGER ADVISED PROPERTY PROJECT IN TOWER A RUN
INTO
FINANCIAL DIFFICULTIES IN CLOSING THE ACQUISITION 
    * INVESTMENT MANAGER SAID BANKS INTENT TO REDUCE ITS LENDING
AND
THE RESULTING FUNDING GAP WHICH REQUIRES NEW EQUITY INJECTION,
WHILE IT COULD BE EXPLORED, IS NOT ECONOMICALLY FEASIBLE YET
BASED ON LOW PROJECTED RETURN
    * INVESTMENT MANAGER ADVISED ABOUT 50% OF PURCHASE PRICE
PURSUANT
TO EACH OF THE TOWER A AND TOWER B CONTRACTS HAS BEEN PAID
THROUGH A COMBINATION OF EQUITY(30% OF PURCHASE PRICE) AND AN
OFFSHORE BRIDGE LOAN (20% OF THE PURCHASE PRICE) FOR EACH TOWER
    * BRIDGE LOAN FOR EACH TOWER WILL MATURE BY THE END OF
NOVEMBER
2020
    * REMAINING 50% OF PURCHASE PRICE OF EACH TOWER WAS
ORIGINALLY
SCHEDULED TO BE DUE AT THE END OF APRIL 2020 HANDOVER
    * UNDER THE CIRCUMSTANCES, ON BEHALF OF ALL OF THE
INVESTORS, THE
INVESTMENT MANAGER NEGOTIATED VERBALLY WITH THE VENDOR OF TOWER
A TO EXTEND THE PAYMENT DUE DATE
    * ACCORDING TO INVESTMENT MANAGER INVESTORS MAY NOT BE ABLE
TO
CLOSE TOWER A ACQUISITIONS AND MAY RUN TOWARDS PURCHASER DEFAULT
SITUATIONS
    * IN THE EVENT OF DEFAULT, TOWER A INVESTORS ARE
CONTRACTUALLY
REQUIRED TO FORFEIT 20% OF THE TOWER A'S PURCHASE PRICE
    * INVESTMENT MANAGER PROPOSED OPTION TO PROCURE NEW BUYER TO
ACQUIRE 100% OF EITHER TOWER A OR SISTER PROJECT, TOWER B, OR
BOTH AND IN THE EVENT THAT, IF ONLY ONE TOWER IS SOLD, THE
PROCEEDS WILL BE USED TO PAY DOWN EXISTING LOAN OF THE SOLD
TOWER, WITH REMAINING PROCEEDS ROLLED OVER FOR THE PURPOSE OF
ACQUIRING THE REMAINING UNPAID-FOR-PORTION OF THE REMAINING
TOWER
    * THIS WILL RESULT IN THE REMAINING TOWER BEING OWNED
COLLECTIVELY
BY BOTH TOWER A INVESTORS AND TOWER B INVESTORS.
    * IN THE DEFAULT CONTRACT SCENARIO IF THE REQUIRED APPROVAL
CANNOT
BE OBTAINED CO EXPECTS AN IMPAIRMENT LOSS ON THE GROUP'S
CO-INVESTMENT IN TOWER A, AND IMPAIRMENT LOSS OF APPROXIMATELY
US$7,400,000, BEING 74% LOSS ON THE COMMITTED EQUITY INVESTMENT
OF US$10,000,000, WILL BE RECOGNIZED IN Q2 OF 2020

    
    
 Source text for eikon:  urn:newsml:reuters.com:*:nObiT4mGza
    
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