Yangzijiang Shipbuilding Holdings Ltd. said on Monday that it is going to form a joint venture with Qatar Investment Corp. to set up two companies. The joint venture will be establishing YZJ Offshore Engineering Pte. Ltd. in Singapore and YZJ Offshore Engineering (China) Co. Ltd. in China, the company said in a statement.
YOEPL will be an offshore oil and gas industry service provider, performing marketing, procurement, engineering and management consultancy roles. YOECCL’s main business will be producing and repairing offshore and marine vessels and platforms.
Yangzijiang and QIC will jointly (50:50) invest US$110 million in YOEPL initially, the statement said.
YOEPL and Yangzijiang’s wholly owned subsidiary will later jointly invest in YOECCL, with the former putting in US$100 million for a 40% stake, and Yangzijiang’s wholly owned subsidiary investing US$150 million for a 60% interest.
Lee Yue Jer, an analyst at AMFraser , said in a note to clients: “ With the merchant vessel market looking oversupplied for the near future, this is a logical step for YZJ to take to further their offshore oil and gas ambitions. This deal will allow YZJ to leverage on Qatar Investment Corp’s network in the Middle East, and we expect future offshore-related orders from this region .”
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Shipbuilding Tribune Staff, December 20, 2011; Image: yzjship