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China Rongsheng halts trading, cites possible deal announcement
[SHANGHAI] China Rongsheng Heavy Industries Group Holdings halted trading in its shares on Wednesday, citing a pending announcement on a "possible very substantial disposal".
On Tuesday, private Chinese shipbuilder Yangzijiang Shipbuilding Holdings said government agencies had approached it to buy a stake in Rongsheng and that it had yet to make a decision.
Shares in Rongsheng edged up to their highest level since Feb 26 on the news, having halved in price since October.
Rongsheng, one of China's largest private shipbuilders, has been struggling with a heavy debt burden and a slowdown in the shipbuilding market. It said in October than the government was helping it look for external financial support.
Saving Rongsheng has become a test for China's government, which has made reforming bloated industries one of its goals.
Thousands of workers were laid off at the company's yard in east China's Jiangsu province in 2013, where Brazilian miner Vale SA's mega iron-ore carriers are being built.