Yangzijiang Shipbuilding expects favourable rulings in arbitration against subsidiaries

The claims will not adversely affect the group's financial position for 2024.

Yangzijiang Shipbuilding said its three wholly-owned subsidiaries have "a reasonably good prospect of success in the arbitrations" initiated against them over an alleged breach of contract.

After terminating shipbuilding contracts inked on 5 November 2021 for the purchase of four vessels, certain entities initiated arbitration in London against Jiangsu Tianchen Marine Import & Export Co., Jiangsu Yangzi Xinfu Shipbuilding Co., Ltd., and Jiangsu New Yangzi Shipbuilding Co.

The claimants also commenced arbitration proceedings against the three subsidiaries in respect of the contract signed on 30 December 2021 for the purchase of six vessels.

The total value of the 10 shipbuilding contracts is approximately US$900m.

In a bourse filing, the company said its subsidiaries have "good arguable defences and, accordingly, a good arguable case that the claims should be denied."

"Based on the evidence of the respondents’ expert witness, the quantum of the claims is incorrectly measured and highly inflated," the company added.

The company added that the claims will not have a material adverse impact on the group’s financial position for the financial year ending 31 December 2024.