China has approved the merger of state-owned shipping conglomerates China Ocean Shipping (Cosco) and China Shipping, according to press reports.
The merged operation - to be known as China Cosco Shipping Group -is estimated to be worth US$80bn and will be based in Shanghai, reports said. However, if restricted to container shipping operations the value could be US$20bn, reported The Wall Street Journal.
The combined entity is expected to integrate the companies' port operation businesses, commodities shipping as well as tanker divisions, according to ship-technology.com.
The move will mark the consolidation of the world's sixth and seventh largest container shipping firms, who control a total of 11 listed entities in Shanghai, Shenzhen, Hong Kong and Singapore, it said.
The two companies were reportedly asked by the Chinese government to merge in response to a slump in the shipping industry in China, in August this year.
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