Chinese private shipbuilding group China Ocean Industry has announced that the High Court of Hong Kong has granted the company’s application to commence a capital reorganisation.

The court order follows Hong Kong-listed Titan Petrochemicals filing a petition with the court in August to wind up China Ocean Industry due to a debt dispute.

Under the reorgansition scheme, China Ocean Industry will issue convertible bonds of HK$50m and HK$60m to Hong Kong Tong Ji Investment Holding and Wise Benefit Investments separately.

The net proceeds from the bond issuance will be used for repayment of debts and general working capital.

China Ocean Industry will seek the withdrawal of the wind-up petition against the company.

Earlier this month, China Ocean Industry also entered into an agreement with the administrator of Zhejiang Ouhua Shipbuilding to settle their debt disputes.

In July, the group signed a MOU with PetroChina Kunlun Gas to set up a joint venture which will be focused on the development of LNG for vehicles and ships.