Hanwha Aero Capital Increase Reduced from 3.6 Trillion to 2.3 Trillion... "Succession Controversy Dispelled" (Comprehensive)

1.3 Trillion Won Gap to Be Secured Through Third-Party Rights Offering
"Major Shareholder Sacrifices, Minority Shareholders Benefit"
Continued Investment Plans for Essential Business Activities

Hanwha Aerospace is reducing the scale of the rights offering it announced last month from 3.6 trillion won to 2.3 trillion won. The reduced 1.3 trillion won will be secured through a third-party rights offering participated by Hanwha Energy, which is 100% owned by the ‘owner family.’ This move is interpreted as a carefully considered plan to resolve controversies over management succession while maintaining the overall size of the rights offering and executing investments for essential businesses.

On the 8th, Hanwha Aerospace announced that it is reviewing a ‘third-party allotment rights offering’ involving three companies?Hanwha Energy, Hanwha Impact Partners, and Hanwha Energy Singapore (hereinafter Hanwha Energy). If this method is finalized, Hanwha Energy, wholly owned by the owner family including Kim Dong-kwan, Vice Chairman of Hanwha Group, Kim Dong-won, President of Hanwha Life Insurance, and Kim Dong-sun, Vice President of Hanwha Hotels & Resorts, will participate in the 1.3 trillion won third-party allotment rights offering of Hanwha Aerospace ‘without any discount.’ The 1.3 trillion won paid by Hanwha Aerospace to Hanwha Energy from the sale proceeds of Hanwha Ocean will effectively return to Hanwha Aerospace. Meanwhile, minority shareholders participating in Hanwha Aerospace’s shareholder-allocated rights offering can purchase shares at a 15% discounted price. Hanwha explained this as "a measure where the major shareholder Hanwha Energy sacrifices, and Hanwha Aerospace’s minority shareholders benefit."

Previously, Hanwha Aerospace and Hanwha Energy held a preliminary briefing for directors to discuss a plan to return the 1.3 trillion won from the sale of Hanwha Ocean shares. Since Hanwha Aerospace’s acquisition of 7.3% of Hanwha Ocean shares (worth 1.3 trillion won) before the announcement of the rights offering sparked controversy over management succession, this move aims to resolve related disputes. Lee Jae-gyu, CEO of Hanwha Energy, said, "We considered Hanwha Aerospace’s participation in the third-party allotment rights offering to avoid unnecessary succession controversies."

With this measure, the succession controversy that persisted even after Vice Chairman Kim’s purchase of Hanwha Aerospace shares (about 3 billion won) and Chairman Kim Seung-yeon’s transfer of 11.32% of Hanwha Corporation shares to his three sons is expected to come to an end. Hanwha Aerospace plans to focus on its ‘core business’ through stable funding and investment going forward. The company currently plans long-term investments totaling 11 trillion won, including ▲securing local production bases in Europe ▲research and development for new market entry ▲investment in ground defense infrastructure. Of this, 3.6 trillion won will be raised through the rights offering, and the remaining 7.4 trillion won will be secured through future operating cash flow and borrowing from financial institutions. A Hanwha official said, "We plan to continue bold large-scale investments as a survival strategy for essential business activities."

Meanwhile, on the 8th, Hanwha Aerospace held a ‘Future Vision Briefing’ for the media to explain the company’s growth strategy, including its mid- to long-term investment plans.

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