Yangzijiang Shipbuilding said on Thursday it entered a joint venture agreement with Japanese shipbuilding yards Mitsui E&S Shipbuilding (MES-SC) and Mitsui & Co. to build a range of commercial vessels.
The joint venture will have registered share capital of up to US$99.9 million and the total capital employed could amount to US$299 million, it said in a filing to SGX after the market close on Thursday.
Yangzijiang will hold a 51 percent stake in the joint venture, which will have its production base at its existing Taicang yard in Jiangsu, China, with operations expected to begin in April 2019, the filing said.
“The new joint venture is expected to consolidate MES-SC’s advanced shipbuilding technology and our cost-effective shipbuilding capability,” Ren Yuanlin, executive chairman of Yangzijiang, said in the statement. “The establishment of the new joint venture will enhance YZJ Group’s competitiveness and preserve the dominant position for Chinese shipbuilders in the ongoing consolidation of the global shipbuilding industry.”
He added that the company was optimistic on the outlook for Chinese demand for LNG import and LNG carriers.
In September, Yangzijiang entered a separate joint venture with Mitsui & Co. to establish a company in Panama to combine it shipbuilding expertise with the Japanese company’s access to ship owners.
Yangzijiang currently produces a range of commercial vessels, including large containerships, bulk carriers and LNG carriers, the filing said.