China Shipbuilding targets $937m IPO for expansion

China Shipbuilding Industry is planning a US$937 million initial public offering (IPO) in Shanghai to fund expansion of engine and parts facilities, Bloomberg reported. The company will issue up to 1.995 billion shares at a price range to be announced on December 3. Analysts said China Shipbuilding would benefit from long-term government plans to develop the industry, but that the short-term outlook remained grim. Total new-ship orders in China dropped 70% in the first nine months of 2009, and more than 20% of the China Shipbuilding's profits in the first half came from government subsidies. The company said it will use the proceeds of the IPO to build or expand 22 projects.