China's train-makers CSR and CNR to merge

(ECNS) -- A merger between China's top train-makers - China CNR Co., Ltd. and CSR Co., Ltd. - has been drafted and presented to the State Council, China's cabinet, according to the 21st Century Business Herald on Tuesday.

Based on the initial plan, CSR will acquire CNR, which will delist. After the acquisition, CSR will be renamed China Rail Transit Group Co., Ltd.

In order to encourage competition, the China National Railway Locomotive & Rolling Stock Industry Corporation (LORIC) was divided into CSR and CNR in 2001. After 14 years, due to vicious competition in overseas markets between CSR and CNR, the senior leaders of the two train-makers have decided to merge.

The first merger scenario will combine CSR's and CNR's overseas businesses to form a unified international corporation. The second scenario will apply the strategy of cross-shareholding so that CSR and CNR will be intertwined.