South Korea’s Hanwha Group has been eyeing an acquisition of Austal USA parent Austal (ASX ASB) for quite some time. Today, it appeared to be making some progress. Yonhap News Agency reports
Austal Limited (Austal) (ASX: ASB) advises that it has received advice from South Korean shipbuilder and substantial Austal shareholder, Hanwha Group, that Hanwha has received approval from the Committee on Foreign Investment in the United States (“CFIUS”) to increase its shareholding in Austal up to 100 per cent. Austal also notes statements from Hanwha in the media today this effect.
Upon receipt of that advice from Hanwha, Austal subsequently sought independent verification. Based on informal discussions to date, Austal understands that the approval granted by CFIUS is different to that claimed by Hanwha.
Austal is seeking written confirmation from CFIUS and will update shareholders on receipt of that information.
Hanwha currently holds a 9.9 per cent equity position in Austal, and a further 9.9 per cent economic interest through a cash settled total return swap. Hanwha has applied to Australia’s Foreign Investment Review Board (“FIRB”) to increase its equity position in Austal to 19.9 per cent. That application is still under consideration by FIRB.
As Austal is an ASX-listed defense company, ultimately FIRB with its recommendation and the Australian Treasurer with his decision will determine the extent of any foreign ownership in Austal.
This ASX announcement has been approved and authorized for release by Austal Limited CEO Paddy Gregg.
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