CHINA Merchants Industry Holdings, a key player in the shipbuilding sector under state-owned China Merchants Group, has finalised its acquisition of Qingdao Yangfan, marking a major step in the company’s strategic expansion.

The move follows months of negotiations with the local government that began in late 2024. A co-operation agreement was signed in February 2025 during a conference attended by CMG chairman Miao Jianmin in Shandong. An official announcement of the deal is expected in May.

Photos from the shipyard site show that the name on the gantry cranes has already been changed from “Qingdao Shipbuilding” to “CMI Qingdao Shipyard”, confirming market speculation about the acquisition. A source close to Qingdao Yangfan told Lloyd’s List that the takeover has been completed.

The acquisition is seen as a strategic move by CMI to expand its shipbuilding portfolio. Zhang Yao, a manager at C&D Shipbuilding, a Chinese ship financial leasing firm, described the deal as a “natural match”, enabling CMI to handle orders for container ships and large bulk carriers.

With the integration of Qingdao Yangfan, CMI now controls seven shipyards, the other six of which specialise in vehicle carriers, ro-ro ships, chemical tankers and midsize bulk carriers. The Qingdao yard is expected to benefit from CMI’s fully integrated supply chain.

Located in the Nudao shipbuilding base, the yard spans 790,000 sq m and includes two dry docks. Once fully operational, it will be capable of processing 200,000 tonnes of steel and building up to 1.5m dwt in vessels annually.

According to the company data, Qingdao Yangfan’s order book includes eight 210,000 dwt bulk carriers and nineteen 82,000 dwt bulk carriers.

Two of the larger vessels were ordered by China Merchants Energy Shipping in June 2024 for Yuan1.1bn ($144 million), with delivery scheduled for the second half of 2027.

Founded in 1949, Qingdao Yangfan filed for bankruptcy in 2016 amid financial difficulties. A court-led restructuring in 2018 transferred ownership to Qingdao Huatong. Remarkably, by the end of 2019, the yard completed its restructuring with 100% repayment to all creditors — a first in China’s shipbuilding sector.

The acquisition also comes amid escalating trade tensions between the world’s two largest economies, with the US proposal to impose port fees on Chinese-built ships potentially reshaping global shipbuilding dynamics and posing a threat to shipyards in China.

Both CMI and the former owner of the Yangfan yard have been contacted for comment.