Austal shares surge as Hanwha Group buys up 9.9% holding
Make us a preferred source
Make us a preferred source on Google
More news: Austal shares rocketed in morning trade after South Korean conglomerate Hanwha Group bought a 9.9% holding in the ship builder for around $183 million.
Austal shares were up 7.1% to $4.10 at 11:50am AEDT, having advanced more than 90% over the last 12 months.
South Korea's Hanwha buys 9.9% stake in Austal, seeks board seat
The news: South Korean conglomerate Hanwha Group has acquired a 9.9% shareholding in Australian ship builder Austal, and sought regulatory approval to increase its interest in the company to 19.9%.
The numbers: Hanwha bought 41.2 million Austal shares for $4.45 per share, according to an ASX filing. Austal shares last closed at $3.83 per share, having advanced nearly 80% over the last 12 months.
The context: Hanwha said it wants to become a "long-term strategic partner with Austal in developing Australia’s defence industry capability".
The group intends to make a "meaningful contribution" to Austal and Australia’s defence industry through its manufacturing and operational experience, it said.
Hanwha, which has been operating in Australia since 2005, requires approval from Australia's Foreign Investment Review Board to take its investment beyond 10%. The group said it will also engage with Austral about gaining a position on the board.
What they said: “As a strategic shareholder there will be a great opportunity for us to add significant value to Austal’s business, including in global defence and shipbuilding, supporting investment in Australia’s local manufacturing industry and capacity,” said Michael Coulter, global CEO and president at Hanwha's defence division.
“Hanwha’s position as a global leader in smart shipbuilding will provide Austal access to capital, international relationships and operational and technical expertise which can accelerate the development of Austal’s business and in turn, enhance Australia’s sovereign defence capability, at a time when this capability is more important than ever.”
The sources: Hanwha media release, ASX
