Under the agreement, the Chinese Export-Import Bank will provide financial support, consultation, overseas investments and equity acquisition to the newly merged shipping conglomerate to help the company optimize its fleets, among other things.
China COSCO Shipping Corp. (COSCOCS) has signed a 120 billion yuan renminbi (U.S. $18 billion) financing deal with the Export-Import Bank of China in an effort to increase the ocean carrier’s competitiveness.
Under the agreement, the bank will provide financial support, consultation, overseas investments and equity acquisition to the newly merged shipping conglomerate to help the company optimize its fleets, among other things. The financing agreement is also aimed at supporting China’s domestic shipbuilding industry to promote industrial restructuring and upgrading.
COSCOCS said it intends to use the funds to finance more than 50 ships currently on order at local yards, including very large crude carriers (VLCC), very large ore carriers (VLOC), and 19,000-TEU containerships, as well as potential acquisitions.
“The doldrums in the international shipping market has brought pressure to us, but it also provides opportunities for us to acquire overseas assets to complete our global network,” COSCOCS Group Chairman Xu Lirong said of the agreement.
COSCOCS was formed earlier this year through the merger of former state-owned conglomerates China Ocean Shipping Co. (COSCO) and China Shipping Co. (CSCL). Following the full integration of the two firms’ respective container businesses, and the concurrent mergers of CMA CGM with APL and Hapag-Lloyd with United Arab Shipping Co. (UASC), COSCOCS will rank as the fourth largest container carrier worldwide with an overall deployed fleet capacity of 1.69 million TEUs, according to ocean carrier schedule and capacity database BlueWater Reporting.
China COSCO secures $18b in financing from China Ex-Im Bank
