Korea's first 3,000-ton-class Dosan Ahn Chang-ho submarine is on display at a launching ceremony at Daewoo Shipbuilding & Marine Engineering's shipyard in Geoje, South Gyeongsang Province, in this September 2018 file photo. Korea Times file
Conglomerate confident of reassuring shipbuilder's workers
Hanwha Group Vice Chairman Kim Dong-kwan / Courtesy of Hanwha Group
By Park Jae-hyuk
Hanwha Group's latest decision to acquire Daewoo Shipbuilding & Marine Engineering (DSME), which manufactures naval ships and submarines, has made it possible for Korea's seventh-largest conglomerate to become a top-tier global defense industry powerhouse, according to industry officials Tuesday.
Given that the group owns subsidiaries leading the solar and renewable energy markets, its planned takeover is also expected to accelerate the global shipbuilding industry's transition to green energy.
Hanwha signed a conditional deal on Monday with DSME and its largest shareholder, Korea Development Bank (KDB), to acquire a 49.3 percent stake in the shipbuilder for 2 trillion won ($1.4 billion) and said it aims to become a major global firm in both the defense and renewable energy businesses, integrating its core competencies with DSME's capabilities in design and manufacturing.
According to the business group, Hanwha Aerospace and Hanwha Systems will invest 1 trillion won and 500 billion won, respectively, while Hanwha Impact Partners will pay 400 billion won, and Hanwha Energy's three subsidiaries will pay the remaining 100 billion won, aiming to sign the main contract by the end of November.
Hanwha has shown interest in DSME for a long time. That's because Hanwha lacks a warship manufacturing unit, although it has produced self-propelled howitzers for the army and supplied radar systems and aircraft engines for the air force.
"By sharing our consumer networks in the Middle East, Europe and Asia, we expect an increase in exports of defense systems of Hanwha Aerospace and Hanwha Systems, as well as DSME's flagship 3,000-ton-class submarines and warships," Hanwha Group said in a press release. "Once Hanwha Systems' cutting-edge maritime systems technologies are integrated with DSME's shipbuilding capacity, we will also be able to develop self-navigating commercial ships."
