World’s No. 1 Shipbuilder, Hyundai Heavy Industries, Announces Four-Way Split

Shipyard of Hyundai Heavy Industries is seen in Ulsan, about 410 km (255 miles) southeast of Seoul June 28, 2013. South Korea’s growth momentum remained subdued in June, key government and private-sector data showed on July 1, casting fresh doubts about whether the trade-dependent economy can stage a firm recovery in the coming months. The indicators suggest that Asia’s fourth-largest economy remains under pressure and that a gradual recovery forecast by local policymakers remains far from a certainty. Picture taken June 28, 2013. REUTERS/Lee Jae-Won (SOUTH KOREA – Tags: BUSINESS MARITIME)

South Korea’s Hyundai Heavy Industries is being split into four companies, with its non-shipbuilding businesses being spun off to improve management efficiency and competitiveness, the shipbuilder said on Tuesday.

South Korean shipbuilders have been selling non-core assets and slashing jobs to cope with shrinking orders from the oil industry that forced the firms into heavy losses last year. South Korea is home to the world’s three largest shipbuilders – Hyundai Heavy, Daewoo Shipbuilding & Marine and Samsung Heavy Industries Co Ltd.

Under the plan, Hyundai Heavy will be divided into four companies. It will retain core businesses, including shipbuilding, offshore and industrial plant, while three other firms will focus on electro electric systems, construction equipment and robot business, the company said in a statement.

Existing Hyundai Heavy stakeholders will be get around 0.75 shares of the company and shares in each of the three other entities.

The spinoff is part of its restructuring plan submitted to creditors.

The three newly created companies will seek listings on the stock market. The company expects the separation to be completed on April 1, 2017. (Reporting by Hyunjoo Jin; Editing by Clarence Fernandez and Muralikumar Anantharaman)

Source: gCaptain