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September 24, 2020

HHI in talks with EU regulators on $1.8bn DSME merger deal

South Korean shipbuilder Hyundai Heavy Industries (HHI) is in talks with EU antitrust regulators regarding the $1.8bn merger with Daewoo Shipbuilding & Marine Engineering (DSME).

South Korean shipbuilder Hyundai Heavy Industries (HHI) is in talks with EU antitrust regulators regarding the $1.8bn merger with Daewoo Shipbuilding & Marine Engineering (DSME).

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HHI aims to address the competition concerns regarding the deal.

The merger will offer the company a 21% stake of the entire market share.

While the merger will reduce the competition in the cargo shipbuilding market, it will also result in higher prices, fewer options and decreased incentives to innovate.

In December last year, the European Commission (EC) launched a detailed investigation into the merger of DSME and HHI.

The organisation halted the process in April as it was waiting for information to be provided by the companies, following which it set a deadline of 3 December for reaching a decision when it resumed the investigation in June.

The authorities dropped the concerns regarding the impact on large container ships, oil tankers and liquefied petroleum gas (LPG) carrier markets.

It is now investigating the impact on the liquefied natural gas (LNG) carriers, which are used to ship LNG between Europe, the Middle East and North Africa.

Last month, the Competition and Consumer Commission of Singapore (CCCS) approved the merger between Korea Shipbuilding & Marine Engineering (KSOE) and DSME.

Hyundai Heavy, Hyundai Mipo Dockyard and Hyundai Samho Heavy Industries are managed by KSOE.

To acquire DSME, Hyundai Heavy Industry Group divided Hyundai Heavy Industries into KSOE and Hyundai Heavy Industries Co.

If the acquisition of DSME is approved, Hyundai Heavy Industries Group will manage four shipbuilders.

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Free Report
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What’s missing from your IPO industry assessment?

IPO activity all but stopped in 2020, as the investment community grew wary of the effects of COVID-19 on economies. No matter how deserving a business was of flotation, momentum was halted by concerns of when a ‘new normal’ of working patterns and trade would set in. Recently, sentiment has changed. Flotations picked up again during the second half of 2021, and now in 2022 the mood is decidedly optimistic. Business leaders have their eyes on fast rebounding economies, buoyant market indices and the opportunity once again to take their businesses public. As a result, global IPOs are expected to hit back this year. With GlobalData’s new whitepaper, ‘IPOs in Consumer and Retail: 5 must-include elements for your prospectus industry report’, you can explore exactly what is needed in the essential literature. GlobalData’s focus lies in the critical areas to get right:
  • Macroeconomic and demographic environment
  • Consumer context
  • Industry environment
  • Competitive environment
  • Route to market
Interested to learn more about what to include in your IPO Industry Assessment report? Download our free whitepaper.
by GlobalData
Enter your details here to receive your free Report.

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