The Kyodo news service has reported that Kawasaki Heavy Industries Ltd. (KWHIY)
of Japan will
spin off its shipbuilding division on Oct. 1 into a new wholly owned subsidiary.
The new subsidiary will reportedly be known as Kawasaki Shipbuilding Corp.
, and will specialize in the manufacture of ships and related equipment, Kawasaki Heavy said in a release.
The spinoff is designed to create an efficient corporate structure that will enable the shipbuilding arm to cope with the global shipbuilding industry's oversupply and operate profitably in the long term by giving its managers greater leeway in running it, Kawasaki Heavy said.
The new firm will concentrate business resources on high value-added products such as submarines, liquefied natural gas carriers and liquefied petroleum gas carriers, it said. The firm has the Defense Agency among its major customers.
The new subsidiary will take over 1,750 of Kawasaki Heavy's 14,067 employees. It will be located in Kobe, the same location as the parent firm.