China Merchants Industry Holdings Co., Ltd (CMI) completed the acquisition of Qingdao Yangfan Shipbuilding.
According to industry sources, CMI’s acquisition of Qingdao Yangfan Shipbuilding has been in the works for a long time, which was only recently disclosed and is expected to be officially announced in May this year. Currently, the name printed on several gantry cranes in Qingdao Yangfan’s factory has been changed to “China Merchants Industry Qingdao Shipyard”, which means that this major acquisition has been officially finalized.
With this acquisition, CMI will enter the field of building standard ship types such as container ships, whereas its shipyards mainly undertake car carriers, ro-ro vessels, chemical tankers and medium-sized bulk carriers. This move will help CMI to integrate and optimize its shipbuilding resources and layout, enhancing its shipbuilding capacity.
The official website shows that CMI has built the Yiulian Dockyards (responsible for ship maintenance and conversion), China Merchants Heavy Industry (responsible for offshore engineering equipment manufacturing), China Merchants Jinling (responsible for special ship manufacturing) and China Merchants Cruise (responsible for luxury cruise ship manufacturing) brands according to different businesses, and has deployed multiple production and manufacturing bases in core areas such as the Bohai Bay, the Yangtze River Economic Belt, the Yangtze River Delta region and the Guangdong-Hong Kong-Macao Greater Bay Area.
The ship repair and conversion business includes Hong Kong Yiulian, Shekou Yiulian, Zhoushan Yiulian and Shandong Yiulian, which have the ability to repair and modify all types of ships, including the repair and conversion of conventional ship types such as oil tankers, bulk carriers, container ships, chemical tankers, etc. LNG/LPG/LEG carrier repairs as well as FPSO/FSO/FSRU conversion and other marine engineering equipment repair and conversion.
The offshore engineering equipment manufacturing business includes China Merchants Heavy Industry (Jiangsu), China Merchants Heavy Industry (Shenzhen), Shenzhen Offshore Equipment Research Institute, and Sanya Deep Sea Equipment Research Institute, with one-stop FPSO delivery capabilities. At present, nearly 100 high-end offshore engineering products have been delivered, including the world’s largest tonnage 460,000-ton FPSO, independently developed medium-deepwater anchored semi-submersible platforms, wind power installation platforms, saturation diving support vessels, deep-sea rescue vessels and other high-end products. At present, the company has formed a system of five major offshore products, including offshore oil and gas exploration and development equipment, offshore oil and gas production equipment, offshore new energy development equipment, special offshore engineering equipment, and offshore fishery resources development equipment.
The Specialized ship manufacturing is distributed in three manufacturing bases: China Merchants Jinling Shipyard (Nanjing), China Merchants Jingling Shipyard (Weihai) and China Merchants Jinling Shipyard in Yangzhou. CMI has developed into the world’s largest RoRo and Ropax ships manufacturer. It is the earliest shipbuilder in China to build ro-ro ships, with the most complete categories, the most delivery performance and the most orders on hand. The six small and medium-sized chemical tankers and gas tankers designed independently have filled the gap in the shipbuilding industry.
As for luxury cruise ship manufacturing business, CMI has staged and tiered thedesign and manufacturing of high-end river cruise ships, polar expedition cruise ships,as well as small and medium-sized cruise ships. In 2019, it took the lead in delivering the firstpolar expedition cruise ship made in China,which marks thepioneering position of cruise ship manufacturing in China and leading the development of the domestic cruise ship manufacturing industry. This effort has built an all-in-one cruise ship manufacturing full-process service capability, covering cruise ship R&D, design, manufacturing,supply chain, and maintenance services. As of now, a total of six polar expedition cruise ships, one luxury Yangtze River cruise ship, and two high-end coastal cruise ships have been delivered. A series of independent designed cruiseships covering rivers, coastlines, and seagoing cruise ships, known as “Pan-Cruise,” has been established. Among them, the independently designed and built Polar Expedition Cruise Ship project won the Commendation Award at the Seventh China Industrial Awards.
It is understood that the predecessor of Qingdao Yangfan Shipbuilding (Qingdao Shipyard) was the state-owned Qingdao Shipyard, which was founded in 1949. It is a wholly-owned subsidiary of Qingdao Huatong State-owned Capital Operation (Group) and has a wholly-owned subsidiary.
The shipbuilding base is located in the Nvdao Ship Heavy Industry Base in Jimo District, Qingdao City, 90 kilometers away from Qingdao City. The plant area is 790,000 square meters, the outfitting dock is 1,090 meters long, and the dock water depth is -7.8 meters. It has two large and small dry docks, the large dock is 480 meters × 76 meters, and the small dock is 180 meters × 28 meters. It is equipped with two 600-ton and one 150-ton gantry cranes and more than 2,000 sets of domestic first-class supporting production equipment. When it reaches full production, it can achieve an annual steel processing capacity of 200,000 tons and an annual shipbuilding capacity of 1.5 million deadweight tons.
Due to excessive expansion and poor management, as well as the continued downturn in the international shipbuilding market and bank risk control and loan suspension, in 2016, Qingdao Shipyard and its wholly-owned subsidiary Qingdao Yangfan Shipbuilding went bankrupt and reorganized due to broken capital chain, involving 1,147 creditors and total debts of 9.1 billion yuan.
On May 14, 2018, the Qingdao Intermediate People’s Court ruled that Qingdao Shipyard is a wholly-owned state-owned enterprise under Qingdao Huatong State-owned Capital Operation (Group). At the end of 2019, Qingdao Shipyard restructuring plan was successfully implemented, and the 100% debt repayment rate set a new record for ordinary debt repayment in the shipbuilding industry.
After a year and a half, the reorganization of Qingdao Shipyard was completed successfully.
After the reorganization, Qingdao Yangfan mainly builds bulk carriers and container ships, and in February 2024, it undertook the world’s first ammonia-fueled 1,400 TEU ice-class container ship “Yara Eyde”. Ordered by Yara Clean Ammonia, Norwegian owner NorthSea Container Line, Yara International and CMB.TECH, the ship will be equipped with 250kWh battery packs and a shore power system, and is expected to be delivered in mid-2026.
Clarkson data show that Qingdao Yangfan currently holds orders for 33 new ships, with deliveries scheduled through 2028, including 27 bulk carriers and 6 containerships.