Hanwha Acquires Daewoo Shipbuilding & Marine Engineering... Signs New Share Subscription Agreement

Hanwha Group Becomes Largest Shareholder by Acquiring Stake in Daewoo Shipbuilding & Marine Engineering

[Asia Economy Reporter Donghoon Jeong] Daewoo Shipbuilding & Marine Engineering and Hanwha Group have signed a final contract for a corporate acquisition.

Daewoo Shipbuilding & Marine Engineering announced on the 16th that it has signed a final contract with Hanwha Group for the issuance of new shares corresponding to 49.3% of the company's equity.

According to the contract signed on this day, Hanwha Group will become the new largest shareholder of Daewoo Shipbuilding & Marine Engineering through an acquisition of shares worth approximately 2 trillion KRW. Daewoo Shipbuilding & Marine Engineering will newly issue 104,386,643 common shares to Hanwha Group at 19,150 KRW per share through a third-party allotment paid-in capital increase.

Earlier, on September 26 of this year, Hanwha Group signed a conditional investment agreement (MOU) to participate in a paid-in capital increase of 2 trillion KRW by Daewoo Shipbuilding and acquire 49.3% of the management rights shares. At the time of signing the agreement, Daewoo Shipbuilding conducted a competitive bidding process for shares under the so-called 'stalking horse' procedure to provide investment participation opportunities to investors offering more favorable conditions than Hanwha Group, but no additional companies expressed an intention to acquire.

Accordingly, Hanwha began due diligence work from mid-October. From the 16th of last month, on-site due diligence was also conducted at Okpo Shipyard in Geoje, Gyeongnam, a core production facility of Daewoo Shipbuilding. It is reported that no major variables that could hinder the acquisition or sale appeared during the due diligence process.

Hanwha Group plans to seek synergy effects in the military special ship business, including submarines, through the acquisition of Daewoo Shipbuilding. Daewoo Shipbuilding operates not only in the merchant ship sector but also in the special ship (warship and submarine) sector. By acquiring Daewoo Shipbuilding, Hanwha will secure special shipbuilding capabilities and establish an integrated land, sea, and air defense system.

The restructuring of Hanwha Group's business structure is also expected to accelerate. Hanwha Group is fostering defense as a future industry. The defense businesses, which were previously dispersed across three companies?Hanwha Aerospace, Hanwha Corporation, and Hanwha Defense?have been integrated into Hanwha Aerospace. Hanwha Group plans to develop Hanwha Aerospace into a 'Global Top 10 Defense Company' by 2030.

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