Jan. 30, 2007 (China Knowledge) – Chinese ship engine maker Hudong Heavy Machinery Co. says it will issue new shares to buy shipbuilding assets in a RMB 12 billion share placement.

The firm will place 400 million shares at RMB 30 each, of which RMB 9 billion will be bought by its parent, China State Shipbuilding Corp. The remainder will go to strategic investors including China Life Insurance, National Social Security Fund, Baosteel Group, Shanghai Electric Group and Citic Group.

The firm would become China's biggest shipbuilding firm after the transaction, Hudong's company secretary said.

Hudong's parent, China State Shipbuilding Corp. - the world's third- largest shipbuilder - was expected to list Hudong in Hong Kong after completing the deal to gain wider access to the domestic and overseas capital market, analysts said.