Yahoo Finance KOP’s subsidiary receives final payment, marking withdrawal from Shanghai Wintastar Project
KOP group CEO Leny Suparman says the monies will generate a healthy cash inflow for the company.
Catalist-listed KOP Limited’s indirect wholly-owned subsidiary KOP Northern Lights (KOPNL) has received the payment of RMB158 million ($30.6 million) from Shanghai Hong Bin Properties (SHBP) in relation to the net proceeds from the disposal of its investment, marking the closure of its arbitration case involving the world’s largest indoor ski resort in China.
The final arbitration judgement issued on Sept 29 constitutes the complete award of the dispute in arbitration relating to the joint venture corporation, Shanghai Snow Star Properties, with Shanghai LuJiaZui Zhi Mao Investment (SLJZZM) and SHBP.
KOPNL received RMB235 million from SLJZZM on Nov 25.
The net proceeds from the disposal of the JVC received by KOPNL after deducting all the expenses and taxes are approximately RMB392 million. KOP had previously injected RMB300 million as the registered capital in the JVC.
KOP group CEO Leny Suparman says the monies will generate a healthy cash inflow for the company, reducing its liabilities as it repays all shareholders’ loans and save on interest cost. “It is a great way to end the year,” she adds.
KOPNL entered into a joint venture framework agreement with SLJZZM and Shanghai Harbour City Development (SHCD) for the development of Wintastar Shanghai located in Shanghai’s Lingang City on Nov 10, 2016.
It then entered into an investment agreement in relation to the incorporation of Shanghai Snow Star Properties with SLJZZM and SHBP — a wholly-owned subsidiary of SHCD — on June 12, 2017, fully contributing its 30% registered capital in the JVC on Nov 13 that year.
As a result of differing views and disagreements between the parties in the joint venture corporation, SLJZZM and SHBP brought the case to the Shanghai International Arbitration Centre (SHIAC) on Dec 28, 2020. KOPNL received a notice of arbitration dated Jan 4, 2021 on Jan 18 that year.
Following a hearing on June 25, 2021, the SHIAC issued a partial judgement on Nov 2021 that the framework agreement and the investment agreement shall be terminated as at Dec 20, 2020, and that SLJZZM and SHBP will acquire KOPNL’s 30% equity interest in the joint venture corporation at a fair market value.
KOP announced the receipt of the final arbitration judgement issued on Sept 29 on Oct 4.
“With the closure of the case and moving forward in 2023, we are positioning the group to consolidate its existing projects as well as explore other ventures in new markets,” says Suparman.
Shares in KOP closed 0.3 cents lower or 5.88% down on Dec 14 at 4.8 cents.
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