Shipbuilders in merger talks

The shipping unit of Shenzhen-based conglomerate China Merchants Group is in talks with China International Marine Containers Group (CIMC) and AVIC International Holding Corp on a strategic merger, according to an exclusive report by Caixin Global. 

China Merchants Industry Holdings Co. plans to take over CIMC and AVIC INTL’s shipbuilding and marine engineering businesses after the merger, reports Caixin Global. If the three-way consolidation takes place, CIMC and AVIC INTL could reduce operational costs and even withdraw from the capital-intensive shipbuilding industry to focus on their core business. 

The possible merger followed the announcement last week by China’s two largest builders, China State Shipbuilding Corp and China Shipbuilding Industry Corp to form the world’s largest shipbuilder as China’s shipbuilding industry ushers in a wave of consolidation. 

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