Ssangyong Construction Returns Home... Global SeAH Pursues Acquisition

Ssyangyong Construction Headquarters Exterior View

[Asia Economy Reporter Kim Hyemin] Ssangyong Construction is returning to domestic ownership after 7 years. This follows the acquisition attempt by Global Sea, a leading domestic mid-sized company ranked number one in clothing exports.

According to investment banking (IB) industry sources and Ssangyong Construction on the 2nd, Global Sea Group recently submitted a Letter of Intent (LOI) to the Dubai Investment Corporation (ICD), the largest shareholder of Ssangyong Construction, to participate in the bidding and has begun full-scale acquisition efforts.

Global Sea Group and ICD are currently conducting detailed negotiations aiming to sign a Stock Purchase Agreement (SPA) between July and August. Notably, both parties have agreed in principle to execute a paid-in capital increase larger than the amount for acquiring ICD's shares. It is known that ICD proposed the capital increase plan to ensure the continuous development of Ssangyong Construction. The specific acquisition amount will be finalized through negotiations.

Global Sea Group is a holding company with Sea Sangyeok, the world's number one medical manufacturing and sales company, as its subsidiary. It owns about ten affiliates including Taelim Paper, the industry-leading comprehensive paper manufacturer; Sea STX Entech, a global engineering, procurement, and construction (EPC) specialist; and Balmax Technology, an eco-friendly energy company. Last year, the group recorded total sales of 4.25 trillion KRW.

Global Sea expects synergies by leveraging Ssangyong Construction’s order backlog worth approximately 7 trillion KRW along with its global recognition, construction experience, and technological capabilities. If this acquisition is successful, it could lead to entry into distribution-related construction projects, housing and hotel businesses, and various private development projects domestically. Overseas, business expansion as a developer beyond simple contracting is anticipated. Synergies between Sea STX Entech, which has strengths in domestic and international oil and gas facilities, power plants, and renewable energy EPC, and Ssangyong Construction are also expected.

For Ssangyong Construction, being under private investors for the first time in 24 years will enable direct investment for company development and proactive responses to various risks. An industry insider said, "Since the dissolution of Ssangyong Group in 1998, and the arrival of major shareholders such as Korea Asset Management Corporation in 2002 and ICD in 2015, it has been difficult to actively respond to unexpected external crises like the financial crisis or COVID-19."

This content was produced with the assistance of AI translation services.