Malaysian-based and Hong-Kong listed cruise operator Star Cruises plans to expand into China's cruise vacation market by launching a route between Hong Kong and Shanghai in August. Senior vice-president Gerard Lim Ewe Keng said the company would line up airline firms for the launch of the new route, which would combine cruise and air travel in packages. The SuperStar Leo would take travellers from Hong Kong to Shanghai on a six-day voyage. Cruise customers would then fly back to Hong Kong, making room for the ship to take another group from Shanghai to the SAR. Mr Lim said the company initially would run the new route three or four times as trial voyages to test China's cruising market. Star Cruises has been operating a cruise journey in Hong Kong with stopovers in Hainan Island and south-eastern coastal city Xiamen since the mid-1990s. Last month the firm made a further move into China by providing cruise-ferry services between Xiamen and Hong Kong with its smaller vessel Wasa Queen. In addition to the Shanghai destination, Star Cruises also planned to provide new routes to other north-eastern cities such as Tsingtao said Dalian. Mr Lim said the company planned to build two new cruise liners in the near future to meet the increased demand expected in the region. Both new vessels would be bigger than SuperStar Leo, the company's largest cruise ship in Asia with a crew capacity of 1,200 and a gross tonnage of 75,338. It was expected to take three years to build the new ships with an estimated investment of about US$350 million each. About 80 per cent would be financed through bank borrowing, or by equity-related instruments such as convertible bonds, Mr Lim said. If Star Cruises chose the second, much cheaper, alternative it needed to have a stronger liquidity for its shares. 'Because the price of convertible bonds depends on the liquidity of the underlying share,' Mr Lim explained. Star Cruises shares have been suffering from poor liquidity since its Hong Kong listing in November 2000 and this has contributed to the share's lower price relative to other cruise players. DBS Vickers Securities said that while international cruise operators such as Carnival, Royal Caribbean and P&O Princess saw their share prices rebound 60 to 104 per cent from their September lows, Star Cruises was still 20 per cent below the level reached before September 11 attacks on the United States. Mr Lim admitted the share's slim public float was one reason for its poor liquidity. Presently, Star Cruises is about 36 per cent controlled by Genting group and 52 per cent by the Lim family, leaving a public float of just 12 per cent. The Lim family is the single largest shareholder of Genting group, which operates casino businesses in Malaysia.