Hanwha Ocean seeks to acquire Australian naval shipbuilder

Hanwha Ocean's shipyard in Geoje, South Gyeongsang Province / Korea Times photo by Kim Hyeong-joon

Hanwha Ocean is moving to acquire Australian defense shipbuilder Austal, as part of its strategy to expand its presence in the global defense market and achieve further growth.Despite Austal’s initial rejection of Hanwha’s acquisition proposal, the shipbuilding company plans to continue with further negotiations, Hanwha Group said Wednesday.Hanwha Group said it recently offered more than 1.02 billion Australian dollars ($665 million) to acquire Austal. The shipbuilder, founded in 1988, is an Australian defense and commercial shipbuilding company headquartered in Australia, with shipyards also in the U.S. state of Alabama.Hanwha has a diverse portfolio related to the defense industry, including aerospace, shipbuilding and defense. By acquiring Austal, Hanwha Group aims to upgrade its shipbuilding subsidiary’s presence as a global defense company.The group believes that the acquisition will not only create synergies in the specialty shipbuilding sector, building high-value special purpose vessels, but also help it gain an advantage in bidding wars for military ships and vessels in the United States and elsewhere.”Hanwha has a value chain in various defense sectors, including Hanwha Ocean’s special vessel business and global commercial ship business as well as Hanwha Systems and Hanwha Aerospace, which complement Austal’s portfolio,” a Hanwha Group spokesperson said.

However, Austal reportedly rejected Hanwha’s proposal, saying that the Australian government is unlikely to approve the acquisition by a Korean company engaged in defense contract work, according to report from overseas media outlets.Hanwha Group believes, on the contrary, that there would be no significant issues with this acquisition. Given the friendly relations between the Australian and Korean governments and Hanwha Group’s substantial business dealings with Australia, including the K9 self-propelled howitzer and the Redback infantry fighting vehicle, the group sees the acquisition would not face any major obstacles and discussions on the deal are not concluded but rather ongoing.Notably, Hanwha is known to have offered a price with approximately a 30 percent premium on Austal’s share price, making it a friendly proposal to the shareholders of the Australian company.”We respect the regulatory approval process and are confident of obtaining approval,” the Hanwha official said. “It is true that we are currently reviewing the acquisition.””Legal reviews conducted through international law firms have confirmed there are no concerns, and the specific amount for the 슬롯놀이터 acquisition is still under negotiation.”

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