Hyundai Heavy Industries inks definitive agreement to acquire DSME
Category: #business  By Mateen Dalal  Date: 2019-03-11
  • share
  • Twitter
  • Facebook
  • LinkedIn

Hyundai Heavy Industries inks definitive agreement to acquire DSME

The deal is anticipated to boost South Korea’s local economy and provide stable job offerings in the country.

Hyundai Heavy Industries Co. (HHI), one of the world’s leading shipbuilding companies, has recently inked a formal deal with the state-run Korea Development Bank (KDB) to acquire its smaller local rival Daewoo Shipbuilding & Marine Engineering Co. (DSME) with some 20% market share.

Sources close to the move claim that KDB, as part of the deal estimated at over 2 trillion won ($1.78 billion), will hand over its Daewoo Shipbuilding stocks to HHI and purchase around 1.5 trillion won worth of Hyundai Heavy stocks which will be issued later.

The policy investor will also consider extending 1 trillion won in financial assistance to Daewoo Shipbuilding, claim sources. Meanwhile, Hyundai Heavy in return will be split into two entities, with one to be listed on the market.

As per a statement, Lee Dong-gull, Chairman, KDB, said that the deal is part of its efforts to help boost the competitiveness of the country’s shipbuilding industry, and to providing stable job offerings and boosting the local economy.

Reports suggest that Hyundai Heavy Industries Group, with the takeover, will have four affiliates under its wing, namely the Hyundai Samho Heavy Industries, Hyundai Heavy, Hyundai Mipo Dockyard and Daewoo Shipbuilding. Moreover, based on the deal’s outcome, the South Korean shipbuilding industry is expected to be dominated by two major shipbuilders Hyundai Heavy and Samsung Heavy, cite reports.

According to a joint statement, the two Korean shipyards said that DSME’s management structure will remain unchanged, while a joint counseling body will be formed to collect and share views from each stakeholder. Moreover, procedures will be carried out to minimize any possible issue in management formed due to the merger.

The shipbuilders added that a commission dubbed the Korea Shipbuilding Industry Development Commission, comprising of industry, government and academic experts, will be formed to restore the shipbuilding industry’s ecosystem.

  • share
  • Twitter
  • Facebook
  • LinkedIn


About Author

Mateen Dalal    

Mateen Dalal

A qualified electronics and telecommunication engineer, Mateen Dalal embarked on his professional journey working as a quality and test engineer. Harnessing his passion for content creation however, Mateen pens down industry-rich articles for ReportsGO.com and a few o...

Read More

More News By Mateen Dalal

Apple intends to inaugurate its new $1Bn campus in Texas by 2022
Apple intends to inaugurate its new $1Bn campus in Texas by 2022
By Mateen Dalal

The U.S – China trade war has been terrorizing the global economy since the dawn of 2018. It has affected the overall financial market and global supply chains. This ongoing trade war has had a negative impacted U.S. tech giant Apple’s sh...

Salesforce to use Amazon’s cloud to enhance call center services
Salesforce to use Amazon’s cloud to enhance call center services
By Mateen Dalal

Salesforce will use Amazon Web Services’ technology to turn customer’s spoken words into text.   The partnership will bring Amazon and Salesforce into more direct competition with call center technology service providers. Sales...

FDA warns Dollar Tree regarding the sale of imported adulterated drugs
FDA warns Dollar Tree regarding the sale of imported adulterated drugs
By Mateen Dalal

FDA’s new warning letter is asking Dollar Tree to ensure the company does not import adulterated medicines   Manufacturers mentioned in the letter include Hangzhou Zhongbo and Shanghai Weierya Daily Chemicals Reports confirm that the...