[Featured Stock] Daewoo Shipbuilding & Marine Engineering Next, HMM?…11% Rise on Privatization Expectations

[Asia Economy Reporter Kwon Jae-hee] HMM surged sharply in early trading on the 27th amid expectations of privatization.

As of 10:07 a.m. on the day, HMM was trading at 19,850 KRW on the KOSPI market, up 9.37% from the previous trading day.

During the session, HMM rose as much as 11.02% to 20,150 KRW before giving up some of the gains.

The rise in stock price is interpreted as driven by expectations that HMM could find a new owner, following news that the government is pushing to sell Daewoo Shipbuilding & Marine Engineering to Hanwha Group. The day before, KDB Industrial Bank signed a conditional investment agreement (MOU) with Daewoo Shipbuilding & Marine Engineering and Hanwha Group, agreeing to sell a 29.3% stake in Daewoo Shipbuilding & Marine Engineering to Hanwha Group for 2 trillion KRW.

KDB Industrial Bank is the largest shareholder of HMM, holding about 21% of its shares. The Korea Ocean Business Corporation, a government-affiliated entity, also holds about 20% of HMM shares.

The Ministry of Oceans and Fisheries mentioned in the presidential report in August that regarding HMM's privatization, "We will create conditions for transferring management rights in the mid to long term," and "We will gradually reduce public institution shareholdings to create conditions for privatization."

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