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Shipyard of Daewoo Shipbuilding & Marine Engineering Co. in Okpo, Geoje Island, about 400 kilometers south of Seoul. (Ministry of Oceans and Fisheries) |
China's antitrust watchdog has approved the merger between two South Korean shipbuilding giants, sources said Monday, possibly paving the way for the creation of the world's largest shipyard.
China's State Administration for Market Regulation has recently sent Korea Shipbuilding & Offshore Engineering Co. (KSOE) a notice that its planned merger with Daewoo Shipbuilding & Marine Engineering Co. (DSME) doesn't violate any antitrust rules or hurt fair competition in the world's second-largest economy.
The unconditional approval is the third of its kind for the ongoing business combination, following similar verdicts made by Kazakhstan in October 2019 and Singapore in August this year.
KSOE, which is the shipbuilding holding company of Hyundai Heavy Industries Group, presented its merger request to the Chinese competition authorities in July last year, with Beijing conducting three reviews.
A KSOE official said the latest go-ahead is expected to have a positive impact on antitrust reviews being carried out by South Korea, the European Union and Japan.
Industry watchers said market attention is now on what decision the EU will make concerning the proposed merger between KSOE and DSME. Citing the coronavirus pandemic, the EU has delayed its review of the combination three times.
In March 2019, Hyundai Heavy Industries signed a deal to purchase a 55.72 percent stake in Daewoo Shipbuilding. The deal would lead to the creation of the world's biggest shipbuilder with a global market share of around 20 percent.
KSOE currently has under its wing the group's three shipbuilding units -- Hyundai Heavy Industries, Hyundai Mipo Dockyard Co. and Hyundai Samho Heavy Industries Co. (Yonhap)
