DSME names new CEO ahead of HHI merger

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DSME names new CEO ahead of HHI merger

Daewoo Shipbuilding & Marine Engineering, a major shipyard, on Friday named a new chief executive officer ahead of a planned merger with its large local rival, Hyundai Heavy Industries.

The company’s board of executives promoted Daewoo Shipbuilding’s vice president, Lee Sung-keun, to the top post, replacing the current chief executive, Jung Sung-leep.

Earlier this month, Hyundai Heavy Industries signed a formal deal with the state-run Korea Development Bank (KDB) to buy its smaller local rival, Daewoo Shipbuilding, a deal that could create the world’s largest shipbuilding group with an approximate 20-percent market share.

If the takeover goes ahead, the Korean shipbuilding industry is expected to be dominated by two major shipbuilders - Hyundai Heavy and Samsung Heavy Industries.

Korean shipbuilders, once a cornerstone of the country’s economic growth and job creation, had been reeling from mounting losses in the past few years, caused by an industry wide slump and a glut of vessels amid tough competition with Chinese rivals.

The combination of the two shipbuilders would create an unrivaled player in the sector. Their combined order backlog accounts for 21.2 percent of the global total.

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