On July 28 and 29, Jinhui Holdings Company Limited (Stock Code: 00137, Stock Name: Jinhui Group) issued two separate announcements regarding sale-and-leaseback transactions for a total of four Ultramax dry bulk carriers under construction, with ICBC Financial Leasing and Jiangsu Financial Leasing respectively. Through the “sale and bareboat charter back” model, the group aims to raise working capital and continue its fleet renewal and upgrade programme.

On July 28, Jinhui Group announced that it had signed charter contracts for two 64,500 dwt bulk carriers with two Hong Kong-based special purpose leasing vehicles of ICBC Financial Leasing Co., Ltd. — Hai Kuo Shipping 1971T Limited and Hai Kuo Shipping 1973T Limited. During the lease term, Jinhui’s shipping subsidiary retains purchase options on the vessels at any time; if the options are not exercised early, the company must repurchase the two vessels upon expiry of the contracts.

The two Ultramax newbuildings, each of 64,500 deadweight tonnes (dwt), are named Jin Yao and Jin Fu, with expected delivery dates in February 2028 and March 2028 respectively. Both vessels will be registered in Hong Kong upon completion. The shipbuilding contract price for each vessel is fixed at US$33.05 million.

The purchasers are both wholly owned by the ICBC group and are independent third parties. The maximum sale price per vessel is capped at US$18 million, with total financing of up to US$60 million for the two vessels. The vessels will be chartered back under bareboat charters for an initial term of up to 5 years (60 months). During the charter period, the lessee (a Jinhui subsidiary) has the option to repurchase the vessels at any time; if the purchase options are not exercised early, the company is obliged to repurchase both vessels at the agreed price at the end of the lease term.

According to the announcement dated July 29, Jinhui Group signed charter contracts with two Tianjin-based shipping leasing platforms under Jiangsu Financial Leasing — Hui Hong (Tianjin) Shipping Leasing and Hui Wen (Tianjin) Shipping Leasing — for two 63,500 dwt Ultramax bulk carriers under construction.

The vessels are named Jin Han and Jin Ming , with scheduled deliveries in December 2026 and November 2027 respectively, and will be registered in Hong Kong.

On pricing, the sale price per vessel adopts the lower of: (i) a maximum of US$17 million, or (ii) 60% of the independent appraised market value 30 days prior to delivery.

The lease structure is also a bareboat charter, with a total term of 84 months (7 years). Jinhui may exercise purchase options at any time from 24 months after delivery until the end of the lease term; if no early purchase is made, the lessee must repurchase each vessel at a fixed residual value of US$5 million upon lease expiry.

The charter hire consists of two components: fixed hire and floating interest-linked hire. For the first 12 quarters, fixed hire is US$540,000 per quarter per vessel, reducing to US$345,000 per quarter thereafter, plus a floating interest component benchmarked to the prevailing overnight financing rate.

Jinhui Shipping stated that amid rising global economic and trade uncertainties and escalating geopolitical risks, the sale-and-leaseback financing instruments allow the group to amortise substantial newbuilding capital expenditures over time, significantly improving cash flow. For accounting purposes, the transactions are treated as financing borrowings and will not generate book profits or losses, while the group retains full operational and management control over the vessels.

Under the overall fleet renewal plan, Jinhui Group continues to expand its orderbook of Ultramax bulk carriers while gradually phasing out older Supramax tonnage.