This photo shows the Okpo Shipyard of Daewoo Shipbuilding & Marine Engineering Co. (DSME) on Geoje Island, 330 kilometers southeast of Seoul, on Dec. 16, 2022. (Yonhap)
SEOUL, April 3 (Korea Bizwire) — Hanwha Group has received approval from the European Union for its plan to acquire Daewoo Shipbuilding & Marine Engineering Co. (DSME), company officials said Monday.
The EU’s decision came earlier than expected, as it was widely expected to deliver the result of its review in mid-April.
Hanwha has obtained the approval from Turkey, Britain, Japan and Vietnam since its takeover announcement in September last year. China and Singapore gave the green light last month.
South Korea is the only country whose decision is pending before Hanwha can proceed with the takeover.
South Korea’s Fair Trade Commission (FTC) said it is reviewing the matter in light of concerns Hanwha could monopolize the naval vessels components market using its dominant position as a company long engaged in the defense industry.
Hanwha, the seventh-largest conglomerate in South Korea, has a dominant market share in the manufacturing of key equipment for military vessels, such as radars, communications and navigation devices and launchers.
The FTC is looking into the possibility that Hanwha could take advantage of its dominant position after the takeover and set certain terms of contracts to favor DSME over other competitors.
The FTC requested Hanwha last month to provide a statement with regard to the concerns and ways to prevent the potential monopoly.
“We are currently in discussions with the company on corrective measures that can address the concerns about potential anti-competition issues,” an FTC official said.
The FTC began to review the takeover plan on Dec. 19 last year. Deliberation on such matters in South Korea usually takes about a month, and it can be extended up to 120 days.
Hanwha signed an initial agreement with DSME for the acquisition through a 2 trillion-won (US$1.53 billion) rights offering.
A formal agreement was clinched in December, under which Hanwha Aerospace and five other Hanwha affiliates will acquire a 49.3 percent stake and managerial control in DSME.
(Yonhap)
