Hanwha Group has acquired equity in the Australian shipbuilding and defense company Austal, becoming a major shareholder. Hanwha Group plans to accelerate its push into the global shipbuilding and defense market.

The US Navy's logistics support ship USNS Wally Schirra, which Hanwha Ocean is responsible for maintenance, repair, and operations (MRO), departs from the Hanwha Ocean shipyard in Geoje, Gyeongsangnam-do, on the 13th, after completing about 6 months of work. /Courtesy of Hanwha Ocean
The US Navy's logistics support ship USNS Wally Schirra, which Hanwha Ocean is responsible for maintenance, repair, and operations (MRO), departs from the Hanwha Ocean shipyard in Geoje, Gyeongsangnam-do, on the 13th, after completing about 6 months of work. /Courtesy of Hanwha Ocean

On the 18th, Hanwha announced that it directly purchased 9.9% of Austal’s equity through over-the-counter trading on the Australian Securities Exchange the previous day. Hanwha also separately entered into a Total Return Swap (TRS) contract through an Australian securities firm for 9.9% of Austal’s equity, which finances mechanisms that allow profits and losses linked to the stock without direct ownership. Hanwha applied for approval from the Australian Foreign Investment Review Board (FIRB) on the 18th for a 19.9% investment in Austal.

This investment was made through a local Australian subsidiary owned 60% by Hanwha Systems and 40% by Hanwha Aerospace. After being rejected in its acquisition proposal for Austal through Hanwha Ocean last year, Hanwha pursued a public equity buyout.

Austal is one of four core suppliers directly building U.S. Navy vessels. It holds a 40% to 60% market share in the U.S. small surface combatant and logistics support vessel sector, ranking first. Austal has shipbuilding facilities in Henderson, Western Australia, Mobile, Alabama, San Diego, California, the Philippines, and Vietnam. Its order backlog amounts to 14.2 billion Australian dollars (approximately 13 trillion won).

Hanwha noted that if Austal’s synergy is combined with Hanwha’s proven construction capabilities in the global commercial shipping and naval sectors and its strong network with the Ministry of National Defense and the Navy, an expansion of orders is expected in the future.

Hanwha Group plans to strengthen its position as a key player in the global shipbuilding and defense sector through its investment in Austal. It aims to enhance strategic partnerships in Korea, Australia, and the U.S. Hanwha previously entered the overseas market by acquiring a U.S. shipyard in December last year. Following the inauguration of President Donald Trump, legislation such as the 'Shipbuilding Law for America' and the 'Naval Readiness Assurance Act' has been introduced, raising expectations for collaboration in the shipbuilding industry with allied countries, including Korea.

Michael Cooler, head of overseas operations at Hanwha Aerospace, said, 'Hanwha’s smart shipbuilding and defense industry capabilities can provide Austal with capital, networks, operational, and technical expertise. We particularly anticipate successful cooperation with Austal based on our experience in establishing strong partnerships in the global defense and shipbuilding industry.'