Deals

China Approves Second Shipping-Related Merger This Month

Sinotrans to become a subsidiary of China Merchants Group
Restructuring comes amid weakness in shipping freight rates

The Sinotrans Ningbo container ship sails out of a shipping terminal in Tokyo, Japan.
Photographer: Kiyoshi Ota/Bloomberg

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By Clement Tan

December 29, 2015 at 9:48 AM UTC

Updated on

December 29, 2015 at 11:33 AM UTC

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China has approved another strategic restructuring of two state-owned shipping-related conglomerates, the second such move this month as the government steps up efforts to shrink industries plagued by overcapacity and create globally competitive businesses.

Sinotrans & CSC Holdings Co. will become a wholly owned subsidiary of China Merchants Group Ltd. and will cease to be directly controlled by the State-Owned Assets Supervision and Administration Commission, the agency known as SASAC said on its website Tuesday. The two holding companies had combined sales of more than 160 billion yuan ($25 billion) in 2013, according to their websites and data compiled by Bloomberg.