March 5, 2008

Japanese shipbuilding merger in works?

Nikkei reports that JFE Holdings Inc. has reached an agreement with Hitachi Zosen Corp. to turn their 50-50 joint shipbuilding venture into a JFE subsidiary.

Reportedly, JFE will pay Yen 30 billion to 40 billion ($289-385 million) to up its stake in the joint venture (Universal Shipbuilding) from 50 percent to 85 percent.

That could pave the way for a much predicted merger of Universal Shipbuilding with IHI's shipbuilding operations.

JFE and IHI were in discussions on such a merger back in January.