The deadline for South Korean offshore and marine giant Hyundai Heavy Industries’ $1.8 billion proposed acquisition of compatriot Daewoo Shipbuilding & Marine Engineering has been extended by nine months, a move said to be inevitable due to the delay in European Union approval.
Anti-competition agencies in the EU, Japan, China, Singapore and Kazakhstan have to approve the planned merger, as does South Korea’s Fair Trade Commission.
Singapore, China and Kazakhstan have already given their blessing to the union of the South Korean offshore and marine players.
However, the European Commission has repeatedly postponed its decision, suspending the review of the proposed tie-up of the two South Korean heavyweights because of the coronavirus pandemic.
Korea Shipbuilding & Offshore Engineering (KSOE), Hyundai’s holding company, announced on Friday it had revised its contract with Korea Development Bank (KDB) to extend until 30 June 2021 the deadline for the investment contracts to acquire Daewoo.
KSOE further said it would extend until the end of the year the deadline for acquiring new Daewoo shares, reported Business Korea.
Hyundai Heavy Industries in March 2019 signed the main contract with the KDB for the acquisition of a majority 55.72% stake in Daewoo.
Japan last year filed a petition with the World Trade Organization, accusing South Korea of providing unfair subsidies, including loans and finance guarantees, to its yards in particular Daewoo.