Pingtan Marine Enterprise to Acquire 46 Fishing Vessels

PR Newswire 20 June 2013
FUZHOU, China, Pingtan Marine Enterprise Ltd. (Nasdaq: PME), an integrated marine services company providing territorial sea fishing and dredging services in the People’s Republic of China (PRC), today announced that the Company recently expanded its fleet through the signing of a “Master Agreement” to purchase 46 fishing trawlers in a transaction totaling approximately $410.1 million. After a thorough third-party appraisal process, the Master Agreement was signed between Pingtan and Fuzhou Honglong Ocean Fishery Co., Ltd., or “Hong Long,” a company owned by Pingtan’s Chairman and CEO, Mr. Xinrong Zhou, for a combination of cash, debt, and relief of prior debt obligations from Hong Long.
The transaction is subject to the receipt of government approvals; however Pingtan began operating the vessels upon the signing of this agreement. The Company immediately began reporting operating results from this transaction for a short period in the current second quarter, with a full quarter beginning in the third quarter of 2013.
Description of Assets – Appraisal Process
The Company expects these vessels will greatly increase its fish harvest volume, revenue, and profitability. Pingtan’s fleet increases from 40 to 86 and its carrying capacity (fish) increases by approximately 45,000 to 50,000 tons (effectively doubling the Company’s current capacity). While the revenues generated vary depending on location, the Company expects each vessel to contribute revenues of approximately $3-$3.5 million annually, and net income of approximately $1 million.
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