Posted on 21 Feb 2025
Two subsidiaries of China's largest shipbuilding conglomerate, state-owned China State Shipbuilding Corp (CSSC), are set to merge through a share swap deal and become the world's largest listed shipbuilder, the two Shanghai-listed firms have announced.
On February 18, CSSC's flagship, China CSSC Holdings, and its smaller counterpart China Shipbuilding Industry Co (CSIC) announced that their shareholders had "overwhelmingly approved" the proposed integration. The shareholders' agreement marks the completion of all corporate governance procedures required for the merger, leaving only administrative approval to be obtained, Mysteel Global notes, as the State-owned Assets Supervision and Administration Commission (SASAC) of the State Council gave its consent last month.
In September last year, China CSSC Holdings revealed plans to merge with CSIC by issuing A-shares to all CSIC shareholders. The transaction is valued at Yuan 115 billion ($15.8 billion), making it the largest merger in China's A-share market in the past decade.
This deal will create the world's largest listed shipbuilding company in terms of ship order backlog. Moreover, it is the largest asset consolidation in China since the establishment of CSSC in November 2019, following the merger of China State Shipbuilding Corp and China Shipbuilding Industry Corp, then both 100% owned by SASAC, as Mysteel Global reported.
Industry insiders believe that the merger will combine the strengths of both shipbuilding giants, boosting research, production capabilities, and supply chain efficiency. The union is expected to make China a dominant force in the global shipbuilding market and accelerate the development of the domestic shipbuilding industry, sources said.
China CSSC Holdings covers a broad spectrum of the shipbuilding industry, including large-scale shipbuilding, ship repair, provision of electromechanical equipment, and offshore engineering. Its subsidiaries include Jiangnan Shipyard, Shanghai Waigaoqiao Shipbuilding, Chengxi Shipyard, and Guangzhou Shipyard International.
On the other hand, CSIC specializes in vessel design, research, and manufacturing. It operates across five key sectors, namely marine defence and equipment, marine transportation, deep-sea equipment, ship repair and conversion, and electromechanical equipment.
China CSSC Holdings estimates that it achieved a net profit of Yuan 3.3-4 billion in 2024, rising by 11.6-35.3% on year, while CSIC's profits will likely reach Yuan 1.2-1.4 billion, bouncing back from the previous year's losses, according to the two firms' performance forecasts released in January.
Source:Mysteel Global
