Oboya has, through its wholly-owned subsidiary in Qingdao, China, signed an agreement to sell the company's production property. The sale has a positive effect on profit of CNY 15.2 million, corresponding to SEK 20.8 million [2.2 million USD], improvement of the company's liquidity by SEK 15 million [1.6 million USD] and reduction of the company's debt by SEK 23 million [2.4 million USD]. The buyer Qingdao Huaxian Zhineng Keji Co., Ltd is a local residential development company in Qingdao with plans to build residentials. Oboya Metal Qingdao's operations will continue to be run in leased premises.
The sale is because the area has in recent years developed from an industrial area to a residential- and cultural area. This has significantly increased the value of the properties. With this, there is also interest in the market for Oboya's other wholly-owned subsidiary Oboya Packaging Qingdao's production property, which is adjacent to the property sold. Underlying market valuation for this amounts to CNY 24–28 million, corresponding to SEK 33–38 million [3.4-3.9 million USD]. After-sales, the company's production will continue to be conducted in leased premises. Parts of the production will also be moved to Oboya's factory in Ho Chi Minh City, Vietnam.
“I am very pleased with the sale of one of our properties in Qingdao, even though the sale has taken longer than originally planned. We also have our second property there under sale, which we hope to be able to carry out in either the fourth quarter of 2019 or the first quarter of 2020. Furthermore, it is satisfactory to see the relatively higher sales values compared to our original indications. We can now streamline our capital structure, significantly strengthen our liquidity and pay back some of the debt,” says Oboya's CEO Robert Wu.
For more information:
Oboya
www.oboya.se