CHINA | Second shipping related merger approved

China has approved another strategic restructuring of two state-owned shipping-related conglomerates, the second such move in the state sector 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 also known as SASAC, said Tuesday on its website. Sinotrans Ltd. said Sinotrans & CSC Holdings will remain its controlling shareholder, but it will be a listed subsidiary of China Merchants. No financial details were provided.
“The reorganization aims to achieve economies of scale and synergies in particular in the areas of logistics, energy and bulk shipping, property development, ports and marine and off-shore
engineering between the two groups to speed up the development of an internationally competitive leading enterprise,” Sinotrans Ltd. said in a filing to the Hong Kong Exchange.
The announcement comes after SASAC on Dec. 11 approved a reorganization of China Ocean Shipping Group and China Shipping Group, with combined revenue of more than USD40 billion. Shipping companies in other countries also are exploring mergers and acquisitions amid a slump in global freight rates.