Chinese shipbuilding giant China Shipbuilding Industry Corporation (CSIC) will merge two of its major yards in Liaoning province in a response to the central government’s call to accelerate consolidation in the shipbuilding industry.
CSIC said the board has approved a proposal to merge Dalian Shipbuilding Industry (DSIC) and Bohai Shipbuilding Industry by transferring full equity of Bohai Shipbuilding into DSIC.
Following the merger, Bohai Shipbuilding will become a wholly owned subsidiary of DSIC.
CSIC said the merger is in line with the central government’s policy to consolidate resources on the supply side and shed overcapacity and will promote the future development and transformation of the group.
DSIC is the flagship yard of CSIC. This week, a Dalian court ruled to liquidate the ship repair unit and ship recycling unit of DSIC due to their inability to repay debts. In January, DSIC’s offshore unit also entered a court-led restructuring due to debt issues.
Merger speculation between China’s two top state-run shipbuilders CSSC and CSIC heated up further with leaders from both groups meeting last week.