Hanwha Ocean, Systems to jointly acquire Philly Shipyard for $100 million

Home > Business > Industry

Hanwha Ocean, Systems to jointly acquire Philly Shipyard for $100 million

Published: 21 Jun. 2024, 13:49

SARAH CHEA
chea.sarah@joongang.co.kr

Philly Shipyard in Philadelphia, Pennsylvania [HANWHA OCEAN]

Hanwha Ocean and Hanwha Systems are acquiring Philadelphia-based Philly Shipyard for $100 million, paving the way for the right to participate in bidding for U.S. warship projects.

Hanwha Ocean will get 40 percent of the U.S. shipbuilder and Hanwha Systems takes the remainder. The deal is expected to be closed in November.

HD Hyundai, Philly Shipyard seal deal on U.S. warship construction

Established in 1997, Philly, a subsidiary of Norway's energy company Aker, produces container vessels and tankers. Philly has built more than 50 percent of the large U.S. merchant vessels, and has been a key player in the construction and maintenance of government-operated ships, including U.S. military's.

Hanwha's acquisition comes as the Korean companies aim to increase their presence in the U.S. defense market.

Under the Jones Act, or Merchant Marine Act of 1920, the United States prohibits any foreign-built, foreign-owned or foreign-flagged vessel from engaging in coastwise trade within the United States.

"The deal to acquire Philly will create some synergy for Hanwha to lead the global shipbuilding and defense market," said Hanwha Systems CEO Eoh Seong-cheol. "We will secure future growth engines by expanding our presence in the Middle East, Southeast Asia, Europe and eventually to the United States."

Hanwha Systems has various high-tech marine system technologies for autonomous commercial vessels, such as the integrated control systems and ship automatic control systems.

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