Hanwha Defense USA, a subsidiary of South Korean defence and industrial powerhouse Hanwha Aerospace, is seeking to acquire shipbuilder Austal USA, a subsidiary of Australian defence company Austal.
The company has made a preliminary, non-binding offer of US $1.05 (approx. A $1.49 billion) to US $1.2 billion (approx. A $1.7 billion) for Austal USA, an established shipbuilder with yards in Mobile, Alabama.
Austal is the largest Australian owned defence company operating in the US, building a number of ships for the US Navy, including the Independence-variant Littoral Combat Ships and Spearhead-class Expeditionary Fast Transport vessels.
The bid was good news for Austal shareholders, with shares up more than 18 per cent.
Austal USA parent Austal said the company board and its advisors had carefully assessed the proposal and determined that it merited further evaluation.
They gave the go-ahead for Hanwha to undertake due diligence related to Austal USA “to improve the certainty of any proposal.”
Hanwha Defense USA spokesman James Hewitt said any deal would be contingent on due diligence permitting a thorough evaluation of Austal USA’s operations and financials, including newly disclosed information.
“Hanwha has made it a priority to significantly contribute to revitalising American shipbuilding and is exploring a range of options to expand our footprint in the United States,” he said.
The deal would come with a $1.05 to $1.2 billion price tag on a cash and debt-free basis, according to the Austal financial statement.
Austal said that neither the acquisition of any publicly traded shares in Austal nor Austal’s core Australasia operations were included in the proposal.
That ensured that Austal’s sovereign shipbuilding mandate and high-performing Australasian business remained fully intact and could continue to generate value for shareholders, the company statement said.
In 2024, Hanwha made an unsuccessful takeover bid for all of Austal. The company rejected the offer citing concerns that regulatory approvals from the US and Australia would not be forthcoming.
But at the time, Austal said they remained open to “further engagement if Hanwha is able to provide certainty on whether a transaction would be approved.”
Hanwha subsequently withdrew the offer.
Hanwha later announced it would acquire the Philly Shipyard which constructs both commercial and military vessels.
That includes the National Security Multi-Mission Vessel (NSMV) as a training ship at state maritime academies.
It plans to build a new missile range instrumentation vessel based on the NSMV design to support the Pentagon’s Golden Dome missile shield system.