Chinese state-owned AVIC International Holdings completed the sale of its 69.77% stake in loss-making AVIC Weihai Shipyard Co. to China Merchants Offshore Engineering last week. The Weihai shipyard is currently building nine Stena E-Flexer Ro-Pax ferries for Stena RoRo. The sale sees control of the yard pass from traditionally aviation and defence focussed AVIC to a wholly owned subsidiary of state controlled China Merchants Group. China Merchants themselves have been restructuring their shipbuilding interests and integrated the former Sinotrans-CSC Shipbuilding Industry Jinling and Jiangdong shipyards into their China Merchants Heavy Industry subsidiary earlier this year. They also took over Zhejiang Eastern Shipyard last year. The remaining 30.23% stake in Weihai shipyard will remain with its current owner the Weihai Government.
China’s Fourth Largest Shipbuilder
The addition of the Weihai facility makes China Merchants the fourth largest shipbuilder in China after CSSC, CSIC, and Cosco Shipping Heavy Industry. The other AVIC shipyard at Dingheng is expected to transfer to China Merchants in the near future. This will allow AVIC to quit shipbuilding entirely. At present it is not clear if AVIC’s stake in ship design and engineering consultancy Deltamarin will also transfer to China Merchants.
The shipyard at Weihai has become an important player in the Ro-Pax building market with nine firm orders for E-Flexer Ro-Pax ferries from Stena RoRo, The first of these vessels, STENA ESTRID, is expected to be in service between Holyhead and Dublin early next year. The second, STENA EDDA, will replace either STENA MERSEY or STENA LAGAN on the Belfast to Liverpool route around mid-2020. The transfer of yard ownership is not likely to affect the construction of the vessels for Stena RoRo or their delivery to Stena Line, Brittany Ferries, and DFDS. In fact, the transaction makes Weihai shipyard part of a much stronger shipbuilding group with the financial resources and structure to support the yard.
The Jinling yard has orders for 12 x up to 7,800 lane metre Ro-Ro ferries for Grimaldi and Finnlines, as well as a further four sister-ships to DFDS’s 6700 lane metre capacity TROY SEAWAYS and EPHESUS SEAWAYS. Germany’s TT-Line also has a 45,000 GT Ro-Pax ferry on order at Jinling, with an option for another.
As well as the nine firm E-Flexer orders, Stena RoRo have options to build another two of the class at Weihai. Italian shipowner Giovanni Visentini is thought to have an option for a sister to Ro-Ro ROSA DEI VENTI at the yard as well.