FUZHOU, China, June 30, 2015 /PRNewswire/ -- Pingtan Marine
Enterprise Ltd. (Nasdaq: PME), ("Pingtan," or the "Company") a
global fishing company based in the
People's Republic of China (PRC), today announced that the
Company has expanded its fleet through the purchase of six fishing
vessels from two companies for approximately RMB 344.4 million (or USD $56.3 million).
Purpose of Transaction
In addition to expanding the fleet, Pingtan's management also
recognized the need to properly diversify its asset base in light
of the moratorium by the Indonesian government prohibiting the
Company's 117 licensed vessels from operating in Indonesian
waters. These recently acquired vessels are currently
licensed and sanctioned by the Chinese Fisheries Management Bureau
("http://www.cnfm.gov.cn/ ") under the Ministry of Agriculture
of China, which allows the vessels
to operate and fish in the Western and Central Pacific Ocean of the
International Waters. The vessels, which are detailed below,
are primarily focused on the catch of tuna and squid.
Pingtan's management is also continuing to work closely with the
Indonesian government, which is currently undertaking a licensing
check for all vessels previously operating in the area.
Asset Details
These six fishing vessels will increase Pingtan's carrying
capacity, and the Company expects each vessel to generate annual
net income of approximately $800,000 to $1
million. The vessels are pre-owned longline fishing
vessels and squid jigging vessels. Longline fishing is a
method of fishing which uses a long line, with baited hooks
attached at intervals by means of branch lines to target fish
species, and squid jigging is a technique which uses a lead sinker
with a hook molded into it to attract squid.
The licenses that Pingtan purchased with the vessels make up the
predominant portion of the total asset value, as indicated by the
Western and Central Pacific Fisheries Commission ("WCPFC"), these
fishing vessels are fully licensed in the Western and Central
Pacific Ocean.
For more information regarding The Western and Central Pacific
Fisheries Commission, please visit http://www.wcpfc.int/ .
The Company went through a third-party appraisal process, and
employed a globally recognized appraiser, BMI Appraisals Limited
("www.bmi-appraisals.com"). BMI Appraisals is one of the
leading valuation companies and has been engaged by more than 1,000
companies, of which more than one-half are listed companies in
Hong Kong, China and
overseas. The total
transaction value was approved by Pingtan's Independent Directors
and equals the appraisal value that was determined by BMI
Appraisal's independent research.
List of 6 Recently Purchased Fishing Vessels
|
Name of Vessel
(Old)
|
Type of Fishing
Method(s)
|
Area of
Fishing
|
Date of
Building
|
Gross Tonnage/Net
Tonnage
|
WCPFC
Record
|
1
|
FU YUAN YU
001
|
Longline
Fishing
|
International
|
3/14/1978
|
495/203
|
http://www.wcpfc.int/node/12412
|
2
|
FU YUAN YU
002
|
Longline
Fishing
|
International
|
6/6/1978
|
491/203
|
http://www.wcpfc.int/node/12413
|
3
|
FU YUAN YU
008
|
Longline
Fishing
|
International
|
4/9/1984
|
580/191
|
http://www.wcpfc.int/node/12409
|
4
|
FU YUAN YU
009
|
Squid
Jigging
|
International
|
4/28/1978
|
495/203
|
http://www.wcpfc.int/node/12410
|
5
|
FU YUAN YU
010
|
Squid
Jigging
|
International
|
6/15/1980
|
590/204
|
http://www.wcpfc.int/node/12411
|
6
|
FU YUAN YU
525
|
Longline
Fishing
|
International
|
6/15/1982
|
652/266
|
http://www.wcpfc.int/node/17084
|
Pingtan includes the valuation reports for these six vessels, on
its website at the following
link: http://www.ptmarine.com/fishing-operations/our-vessels
Transaction Details
The Company has purchased the six fishing vessels from two
companies, Fuzhou Yishun Deep-Sea Fishing CO., Ltd. ("Yishun") and
Fuzhou Honglong Ocean Fishery Co., Ltd. ("Hong Long"), which are owned by Pingtan's
Chairman and CEO, Mr. Xinrong
Zhou. The Company
intends to finance the purchase completely through cash on its
balance sheet, which consisted of $67.4
million at March 31,
2015. The Company
believes that it will have sufficient capital to service its
existing debt and explore further expansion in the coming
months.
Management Commentary
Mr. Xinrong Zhuo, Chairman and
CEO of the Company, commented, "We continued to re-evaluate our
existing asset base through the first six months of the year in
light of the challenging circumstances surrounding the Indonesian
moratorium. We have seen no reduction in consumer demand from
China for seafood products.
As a result, we mutually reached an agreement that resulted in the
sale of privately-owned vessels to Pingtan, with each vessel having
the proper license to fish in international waters. We felt that the short and
long-term opportunity from China's
growing consumer demand could provide significant benefits to
companies that were well-capitalized and positioned to take
advantage. Going forward, we believe that the Indonesian
moratorium will be a positive for Pingtan, as it will ensure proper
pricing and a reduction in competition from lesser capitalized
competitors. But in the interim our Board felt that
diversifying our asset base was in the Company's long-term best
interest. We engaged a third-party appraisal firm to ensure
that the pricing was appropriate, and look forward to deploying the
vessels on behalf of the Company in the coming weeks."
About Pingtan Marine
Pingtan is a global fishing company, engaging in ocean fishing
through its wholly-owned subsidiary, Fujian Provincial Pingtan
County Ocean Fishing Group Co., Ltd., or Pingtan Fishing.
Pingtan Fishing primarily engages in ocean fishing with many of its
self-owned vessels operating within the Indian Exclusive Economic
Zone and the Arafura Sea of Indonesia. Pingtan Fishing is a growing
fishing company and provider of high quality seafood in the
PRC.
Business Risks and Forward-Looking Statements
This press release may contain forward-looking statements that
are subject to the safe harbors created under the Securities Act of
1933 and the Securities Exchange Act of 1934. Readers are cautioned
that actual results could differ materially from those expressed in
any forward-looking statements. In addition, please refer to the
risk factors contained in Pingtan's SEC filings available at
www.sec.gov, including Pingtan's most recent Annual Report on Form
10-K, Quarterly Reports on Form 10-Q and Definitive Proxy
Statement. Readers are cautioned not to place undue reliance on any
forward-looking statements, which speak only as of the date on
which they are made. Pingtan undertakes no obligation to update or
revise any forward-looking statements for any reason.
Contact:
Roy Yu
Chief Financial Officer
Pingtan Marine Enterprise Ltd.
Tel: +86-591-8727-1753
ryu@ptmarine.net
INVESTOR RELATIONS:
The Equity Group Inc.
Katherine Yao, Associate
Tel: +86-10-6587-6435
kyao@equityny.com
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SOURCE Pingtan Marine Enterprise Ltd.