Hanwha Aerospace, Solutions invest $1 billion in U.S. subsidiary

A solar power plant in Kern County, California, built by Hanwha Q Cells USA of Hanwha Solutions [HANWHA SOLUTIONS]

Hanwha Aerospace and Hanwha Solutions will together invest $1 billion in their U.S. subsidiary as part of efforts to expand the solar and defense businesses.

The two companies will spend $500 million each on the rights offering of Hanwha Futureproof, a U.S. subsidiary established in March for corporate acquisitions and projects in the United States.

With the investment, Hanwha Aerospace and Hanwha Solutions will each hold 50 percent of the share. The deal will be finalized on Oct. 30.

Of the raised funds, Hanwha Futureproof will use around 1.3 trillion won ($981 million) to make investments in other smaller companies, using the remainder as operating funds.

The company will likely use the funds to acquire or start new businesses in energy, aerospace or solar, though it did not specify in which areas it will use the funds.

Hanwha Solutions in January announced it was spending $2.5 billion in solar manufacturing in the United States, the biggest solar investment in the country by any company ever.

The investment will be spearheaded by Hanwha Futureproof CEO Jun Tae-won. Jun served as the head of mergers and acquisitions at Hanwha from 2012 and moved to Morgan Stanley Private Equity Management in 2016. Jun returned to Hanwha in 2021.

BY SARAH CHEA [chea.sarah@joongang.co.kr]