Yangzijiang (BS6.SG) is up 1.1% at $1.91 after the shipbuilder says it has entered an agreement to acquire 100% of Jiangsu Zhongzhou Marine Equipment -- which owns shipbuilding facilities of 350,000 square metre yard space, 430 metre deep water coast line -- for RMB420 million ($82.7 million) (implied P/E of 7.7x and 1.2x NAV).

DMG says the acquisition will enable YZJ “to push for better productivity and the yard space at JZME will provide extra production capacity to YZJ as its existing yards will be full over the next two years with current orders”.

House upgrades the stock to Buy from Neutral, “as we see better long term growth prospect following a slew of yard/land acquisition deals at attractive pricing and potentially stronger new orders from the containership market.”