(Yicai) June 13 -- Shares in Antong Holdings surged by the exchange-imposed limit today after the Chinese container transportation service provider, which has been performing poorly in recent years, said it will hand China Merchants Energy Shipping a majority stake in the company in return for control of two of the energy shipping giant’s subsidiaries.

Antong’s share price [SHA:600179] closed up 10 percent at CNY2.32 (USD0.32) on its first day of trading since May 29, when trading was suspended pending the asset reorganization. China Merchants Energy’s stock [SHA:601872], meanwhile, finished the day down 1.1 percent at CNY8.63.

China Merchants Energy will become a controlling shareholder in Antong through the issuance of new shares, according to the asset restructuring deal penned by the two parties yesterday. In return, Antong will secure 100 percent equity in China Merchant Energy’s container transport unit Sinotrans Container Shipping and a 70 percent stake in its Roll-on Roll-off shipping subsidiary, Guangzhou China Merchants RoRo Transportation, which specializes in the transport of wheeled vehicles.

The price of the transaction has not yet been determined as the asset valuation of the two companies is still underway.

The new assets will greatly boost the volume of Antong’s container shipping business, particularly that overseas, and lift its rankings in the country to third and 19th worldwide, Quanzhou-based Antong said. It will elevate the firm’s standing in the industry and its range of services, it added.

China Merchants Energy is mainly engaged in the sea transport of energy resources, such as liquified natural gas. Its revenue from container shipping accounted for 21.4 percent of total revenue in 2023 and that of its car roll on-roll off business 7.5 percent, according to the Shanghai-based firm’s latest annual financial report.

Antong generated revenue of CNY7.3 billion (USD1 billion) last year, while Sinotrans raked in CNY5.5 billion (USD758.4 million), China Merchants RoRo CNY1.9 billion (USD262 million). The asset spin-off and restructuring will have a big impact on the company.

Editor: Kim Taylor