China-based shipping agency services provider Sino-Global Shipping America has signed a joint-venture agreement with Australia-based coal exploration and coke processing company Rocklands Richfield Limited. The proposed joint-venture company will serve as a shipping operator for cargo ships carrying imported goods to China.
Rocklands and Sino-Global anticipate that the joint-venture will primarily serve coal-carrying ships from Rockland’s mining operations in Australia to its coke processing facilities in China.
Rocklands and Sino-Global have each agreed to contribute USD250,000 to fund the joint-venture's start-up and operations, and up to an additional USD250,000 each as needed to operate the company and support its business development activities. The joint-venture will be structured as a British Virgin Islands company, and Rocklands and Sino-Global will each own 50% of the company.
The joint-venture was funded by Sino-Global's internal cash position. The transaction has been approved by Sino-Global's board of directors and is expected to close, subject to customary closing conditions, in March 2009.
Cao Lei, CEO of Sino-Global, said: "We are excited about our partnership with Rocklands and look forward to leveraging our leading shipping agency services through this joint-venture. In addition, we expect that this joint-venture will allow us to utilize our extensive experience providing shipping agency services into complementary areas such as handling cargo, renting and staffing ships, and to provide shipping agency services encompassing river transportation to and from Rocklands 's coke production facility in Huaibei."
Wu Pun Yan, Executive Chairman of Rocklands, said: "Currently we are processing approximately 480,000 metric tons of metallurgical coke per year at our factory in eastern China and expect an expansion project which will lift our total capacity to 1.2 million metric tons per year. Sino-Global's high-quality and timely shipping services combined with the joint-venture's shipping operations platform will help us to link our supply chain and distribution channel seamlessly -- from raw material supply in Australia to our coking factory in Huaibei, China, and eventually to steelmakers throughout China."
