China COSCO Shipping Corp Ltd (COSCOCS), a new company formed by the restructuring of China's top two shipping firms, was officially established on Thursday (February 18).
The Chairman Xu Lirong said his company,now the world's largest bulk vessel and oil tanker operator by fleet size, is planning to deploy more resources to six new businesses.
According to a report in China Daily, the shipping major will focus on logistics, industrial equipment manufacturing, financial and shipping services, investment, and operations linked to the country's "Internet Plus" development program.
"New businesses such as multimodal transportation, warehouse network development, shipping insurance services, offshore engineering equipment manufacturing, hospital and hotel management are all included in the newly formed conglomerate's scope in the long term," Xu said.
The restructuring will integrate the resources and talents of COSCO and China Shipping and achieve an economy of scale, Xu said, noting that the new company aims to be the global leader in shipping, integrated logistics and related financial services.
Xu viewed the deal as a boost to China's influence in the global container shipping market, adding that the world's top three container shippers, all Western companies, now control 40 percent of global capacity, while Asia accounts for 70 percent of the world's container freight volume.
The newly formed company brings together China's two biggest State-owned shipping conglomerates - China Ocean Shipping (Group) Co and China Shipping (Group) Co - to further compete against well-established global rivals.
The new company will control one of the world’s largest fleets of dry bulk vessels, container ships and oil tankers after the merge.
It also owns 830 vessels including container ships, dry bulk vessels and tankers, almost twice the combined fleet of Maersk and Mitsui O.S.K Lines, according to data from ship valuation firm VesselsValue, which does not take into account chartered-in vessels.
COSCOCS currently employ 180,000 workers, more than double the workforce of Maersk.
The restructuring was the most complicated ever in China's capital market, with 74 asset transactions worth 60 billion yuan.