news..24 Aug 2017 11:25
A MAJORITY-OWNED subsidiary of Yangzijiang Shipbuilding has entered into a joint venture involved mainly in steel structure fabrication business.
YZJ said after Wednesday's trading close that its 79.6-per cent-owned subsidiary, Jiangsu Yangzijiang Offshore Engineering Co, will subscribe for a 40 per cent equity in the new JV. Some undisclosed JV partners will hold the other 60 per cent interest.
The JV company, Jiangsu Yangzi Chengkang Marine Equipment Co, will be established in Taicang, Jiangsu province, with an authorised share capital of 100 million yuan (S$20.4 million).
The JV will be developed as a manufacturing enterprise dealing with integrated services. These services relate to the provision, distribution, import and export, as well as after-sales support for certain steel products.
YZJ noted that with China's "One Belt, One Road" initiative gaining momentum, demand is promising for infrastructure-related structures from countries located along the land and sea routes.
The Taicang-based JV is poised to benefit from China's clout as a leading steel exporter, accounting for 22.8 per cent of the world's steel export in 2016.
YZJ added that the JV also stands to tap "huge room" for infrastructure development in South-east Asia.
For a start, certain amount of leasing income for YZJ will come from the use of its existing production capacity and facilities by the JV.
YZJ has rallied recently on a strong showing in its second-quarter performance, having posted a 73 per cent surge in net profit to 719.9 million yuan.