COSCO SHIPPING Holdings Proposes Major Guarantee Mandate – Shareholder Approval Sought

Key Points from the Announcement

• Board Proposal: COSCO SHIPPING Holdings Co., Ltd. has announced a proposal to seek shareholder approval for a new guarantee mandate at its forthcoming Annual General Meeting.
• Total Guarantee Amount: The new mandate will allow the Group to provide guarantees up to US\$5.530 billion (approximately RMB38.102 billion), including the outstanding guarantee balance of US\$1.198 billion (RMB8.253 billion) and an additional guarantee amount of US\$4.332 billion (RMB29.848 billion).
• Scope of Guarantees: The guarantees will cover wholly-owned subsidiaries, non-wholly owned subsidiaries, joint ventures, associated companies, and new project companies across COSCO SHIPPING Lines, COSCO SHIPPING Ports, OOIL, and other entities within the Group.
• No Overdue Guarantees: As of the announcement date, the Group reports no overdue external guarantees.
• Regulatory Compliance: The proposal aligns with Chinese regulatory requirements and stock exchange rules, ensuring all mandates and long-term contracts are submitted for annual shareholder approval.

Detailed Breakdown of the Guarantee Mandate

1. Provision of Guarantees to Wholly-Owned Subsidiaries

• Includes multiple subsidiaries under COSCO SHIPPING Lines and OOIL, such as COSCO SHIPPING Lines (Qingdao), (Dalian), (Ningbo), and various OOIL container shipping entities.
• Significant guarantee amounts are earmarked for OOIL subsidiaries, including individual guarantees up to US\$14.625 million each for several entities.
• For subsidiaries with asset-liability ratios over 70%, the total balance and additional guarantee amount reach US\$48.82 million and US\$131.93 million, respectively.
• For subsidiaries with asset-liability ratios below 70%, the Company will provide up to US\$151.96 million in additional guarantees.

2. Guarantees to Non-Wholly Owned Subsidiaries

• Guarantees extend to new project companies and key port terminals, such as COSCO SHIPPING Ports Chancay Peru S.A., CSP Abu Dhabi Terminal L.L.C., CSP Zeebrugge Terminal NV.
• The total additional guarantee amount for these entities is US\$87.67 million (asset-liability ratio over 70%) and US\$1.3 million (asset-liability ratio below 70%).

3. Guarantees to Joint Ventures and Associated Companies

• Mandate includes guarantees for joint ventures and associated companies, such as Antwerp Gateway NV, Red Sea Container Terminals Overseas Limited, APM Terminals Vado Holding B.V., Hutchison Laemchabang Terminal Limited.
• Total additional guarantee amount for these entities is US\$60.3 million.
• Where guarantees are provided to Antwerp Gateway NV, a counter-guarantee will be received from the entity, but for other entities, no counter guarantee will be required.

Shareholder Considerations & Potential Impact

• Shareholder Approval Required: The new mandate and the authorisation for directors to adjust guarantee amounts based on operational needs will be subject to shareholder approval at the Annual General Meeting scheduled for 26 May 2026.
• Price Sensitivity: The proposal involves large-scale guarantees, potentially increasing the Group’s financial exposure and risk profile. This is a material event that shareholders should closely monitor, as changes in guarantee policy or significant increases in exposure could affect both the Group’s risk profile and market perception.
• Operational Flexibility: Directors will have the authority to adjust the guarantee amounts provided to each entity under the mandate, allowing responsive management to changing operational needs.
• Regulatory Alignment and Shareholder Protection: The Board asserts that guarantees will be provided strictly in proportion to shareholding interests and operational requirements, with no resource or benefit transfers. This helps mitigate concerns about unjust enrichment or asset transfers within the Group.
• Potential Share Price Movement: The scale of the guarantee mandate, its alignment with regulatory standards, and the transparent approach to risk management may be viewed positively by the market, but the increased exposure could also raise risk concerns among investors.

Additional Information

• Exchange Rate Used: US\$1.00 to RMB6.8909 (as issued by China Foreign Exchange Trade Center on 18 March 2026).
• Board Members: The Board consists of both executive and independent non-executive directors, including Mr. WAN Min (Chairman), Mr. ZHANG Feng (Vice Chairman), and others.
• Corporate Structure: The Group includes COSCO SHIPPING Holdings (PRC), COSCO SHIPPING Lines (PRC), COSCO SHIPPING Ports (Bermuda), and OOIL (Bermuda).

Conclusion

The proposed guarantee mandate by COSCO SHIPPING Holdings represents a significant financial commitment and operational flexibility. Shareholders should take note of the size and scope of the guarantees, the regulatory compliance, and the potential for increased risk exposure. The shareholder vote at the Annual General Meeting will be critical, and the outcome may materially impact the Group’s share price and investor sentiment.

Disclaimer

This article is for informational purposes only and does not constitute financial advice or a recommendation to buy or sell shares. Investors should perform their own due diligence and consult professional advisors before making any investment decisions. The information herein is based on publicly available company disclosures and may be subject to change.

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