COSCO orders 16 vessels

China COSCO Holding Ltd<601919><1919>, a listed unit under the country's largest shipping firm China Ocean Shipping (Group) Company, announced to pay US$1.08 billion for 16 vessels from Jiangsu New Yangzijiang Shipbuilding Co. Ltd, said the company in a statement with the Hong Kong Stock Exchange on Monday.

The vessels, with a carrying capacity of 4,250 twenty-foot equivalent units (TEU) each, will be delivered in 2011 and 2012. After the delivery, COSCO's shipping capacity will surge to 800,000 TEUs, thus becoming the world's fourth largest shipping company in terms of shipping capacity.

Under the agreement, COSCO has an option to buy another 4 container ships. The purchase will be funded by bank loans and the company's own financial sources.

The shipping giant said on Dec. 20 last year that its profit for 2007 would rise nine-fold to RMB 18 billion (US2.46 billion), driven by the growing demand for shipping services in China.