Wärtsilä sells its share of Chinese two-stroke joint venture
Wärtsilä says that it intends to divest its shares in the Qingdao Qiyao Wärtsilä MHI Linshan Marine Diesel Co (QMD), a joint venture company for manufacturing large low-speed marine diesel engines.
Wärtsilä's shares in the joint venture will be transferred to the current majority shareholder, Qingdao Qiyao Linshan Power Development Co, a company fully owned by China Shipbuilding Industry Corporation. The closing of the transaction is subject to the required regulatory approvals.
The divestment comes as a result of the announcement made on 18 July regarding Wärtsilä and China State Shipbuilding Corporation (CSSC) joining forces to establish a new joint venture, which will take over Wärtsilä's two-stroke engine business. Through this agreement, CSSC will own 70% of the business while Wärtsilä will hold 30%. The parties will co-operate in two-stroke engine technology, marketing, sales, and service activities. In this new context, the two-stroke business currently owned by Wärtsilä will focus on its core activities, including technology development, licensing, product management as well as sales and marketing of two-stroke engines. The joint venture will be based in Winterthur, Switzerland, the former Sulzer facility that was acquired by Wärtsilä some years ago. Manufacturing will be delegated entirely to licensees.
"The move to divest manufacturing assets will free up resources and increase our emphasis on accelerating the development of new engines and advanced technologies. In particular, Wärtsilä's unique low-pressure dual-fuel two-stroke engine development, the further expansion of the environmentally friendly Generation X -engines, as well as emission reduction technologies will benefit from this increased focus," said Martin Wernli, vice president, Wärtsilä Ship Power, two-stroke and MD of Wärtsilä Switzerland.
QMD will continue to manufacture Wärtsilä low-speed marine engines under license from Wärtsilä via the new joint venture with CSSC. The currently valid license agreement will not be affected.
QMD was established by China Shipbuilding Industry Corporation (CSIC), Wärtsilä Corporation, and Mitsubishi Heavy Industries (MHI) in 2006. According to Wärtsilä, QMD was dedicated to the research and development testing, prototype manufacturing, production, and sales of large low-speed two-stroke marine diesel engines.
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