Nov. 15 (Bloomberg) -- Wonson International Holdings Ltd., a Hong Kong metals and securities trader, will buy a Chinese shipyard for HK$3.5 billion ($449 million), aiming to broaden its revenue base on rising Asian demand for vessels.

Wonson will buy Jiangxi Jiangzhou Shipyard from Million King Investments Ltd., it said in a Hong Kong stock exchange filing today. It will pay HK$500 million in cash and HK$3 billion in notes convertible into shares at 15 Hong Kong cents each.

Wonson gained 4 percent to 26 Hong Kong cents at 3:40 p.m. after resuming trading at 2:30 p.m. today. The stock has surged more than 14-fold this year, compared with the 45 percent increase in Hong Kong's benchmark Hang Seng Index.

The shipyard will compete with rivals in South Korea and Japan by expanding capacity, improving manufacturing processes and maintaining low costs, Wonson said. China last year surpassed Japan to become the world's second-largest shipbuilder and aims to overtake South Korea to become the biggest by 2015.

Jiangxi Jiangzhou, in the southeastern province of Jiangxi, makes vessels, cranes and electrical appliances, Wonson said. The privately owned shipyard, founded in 2005, has taken orders for vessels as big as 16,500 tons from customers in Europe, it said.

The shipyard will expand building capacity to 250,000 tons by 2010, Wonson said, without giving the current capacity. Demand for vessels is rising because of rapid economic growth in Asian nations such as China and India, it said.

Phone calls today to Jiangxi Jiangzhou seeking comment weren't answered. A receptionist who answered the phone at Wonson said no one was available to respond to questions.

To contact the reporters on this story: Lee Spears in Beijing at lspears2@bloomberg.net; Clare Cheung in Hong Kong at scheung4@bloomberg.net

Last Updated: November 15, 2007 02:47 EST