Australian government approves plan to raise stake to 19.9% Austal to build warships at U.S. shipyard
Panoramic view of Austal’s Mobile shipyard in the United States. Provided by Hanwha
Hanwha Group is set to become the largest shareholder of Australian shipbuilding and defense company Austal. Austal is the leading company in the U.S. market for small surface vessels and auxiliary support ships. Industry observers assess that Hanwha has secured an additional foothold for the Korea-U.S. shipbuilding cooperation project MASGA (Make American Shipbuilding Great Again).
Australian Treasurer Jim Chalmers issued a statement on the 12th (local time) announcing that he had “accepted the recommendation of the Foreign Investment Review Board (FIRB) not to oppose Hanwha’s proposal to increase its stake in Austal from 9.9% to 19.9%.” Austal operates shipyards in Mobile, Alabama and San Diego in the United States, where it builds and supplies naval vessels to the U.S. Navy. As it is designated as a strategic enterprise by the Australian government, any sale of shares to foreign companies requires approval from both the U.S. and Australian governments.
Hanwha has been pursuing an acquisition of shares in the company since last year to strengthen its U.S. defense ship business. In March this year, it acquired a 9.9% stake in Austal through an over-the-counter transaction, and then sought approvals from the U.S. and Australian governments to increase its stake to 19.9%. The U.S. government already granted approval in June this year. Hanwha will now surpass the current largest shareholder, Tattarang Ventures (19.28%).
However, the share acquisition is not aimed at securing management control. Minister Chalmers also stated that “Hanwha cannot increase its stake in Austal beyond 19.9%.” Hanwha likewise issued a statement on the 12th saying it “will fully comply with the conditions of approval.”
With Hanwha securing a local shipyard base following the U.S. Philly Shipyard, MASGA is expected to gain further momentum. This is because Hanwha’s existing shipbuilding capabilities are anticipated to create synergy with Austal’s U.S. naval vessel construction technology and its network with the U.S. Department of Defense and the U.S. Navy.
Choi Won-young
AI-translated with ChatGPT. Provided as is; original Korean text prevails.
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