Business / Corporate

Mitsubishi Heavy looks to spin off ship-building business

Kyodo

Mitsubishi Heavy Industries Ltd. is considering spinning off part of its ship-building business to turn around its overall earnings, sources said.

The heavy machinery maker may set up a separate company to build vessels such as liquefied natural gas and liquefied petroleum gas carriers while also considering a business tie-up between the new entity and other firms to enhance its profitability, the sources said Tuesday.

MHI will keep building Maritime Self-Defense Force vessels but could withdraw from the business of making large cruise ships if it continues loss money, they said.

Sluggish business in the ship-building segment have dragged MHI’s overall earnings down.

It logged extraordinary losses of about ¥64 billion in consolidated earnings in fiscal 2013 and ¥40 billion in the first half of fiscal 2014 due to a delay in building two large luxury liners for foreign customers.

Coronavirus banner