Hanwha Ocean withdraws police complaint aginst HD Hyundai Heavy Industries

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Hanwha Ocean withdraws police complaint aginst HD Hyundai Heavy Industries

Published: 22 Nov. 2024, 18:43

LEE JAE-LIM
[email protected]

The Military Sealift Command's USNS Yukon oiler, for which Hanwha Ocean secured deal for maintenance, repair and overhaul, is to be delivered to the U.S. Navy by April 2025. [HANWHA OCEAN]

Hanwha Ocean has decided to withdraw its police complaint against shipbuilding rival HD Hyundai Heavy Industries, which accused HD Hyundai executives of involvement in a military leak scandal, citing the importance of cooperation in the national interest.

"We believe withdrawing the complaint is the right course of action to ensure the timely deployment of next-generation Aegis destroyers for maritime security and to expand South Korea's defense exports," Hanwha Ocean said, adding it has submitted a notice to the National Police Agency to withdraw its complaint against HD Hyundai.

Hanwha Ocean claimed top officials of HD Hyundai may have been involved in a military secrets leak scandal after several HD Hyundai employees were convicted in November 2023 of acquiring military secrets related to the Korea Destroyer Next Generation (KDDX) project and sharing them on their company server from 2012 to 2015.

The KDDX naval project aims to build six 6,000-ton next-generation destroyers by 2030, with an estimated 7.8-trillion-won ($5.5-billion) budget. The two shipbuilders have been locked in a bidding war to be selected as a contractor for different phases of the government-led project.

“Although delayed, we are relieved that Hanwha Ocean has decided to withdraw its complaint,” HD Hyundai Heavy Industries responded following Hanwha Ocean’s announcement. “Given the significant delays in the KDDX project, we hope that Hanwha Ocean will also withdraw its application as a defense contractor, allowing the project to proceed swiftly in accordance with laws and principles.”

Industry insiders noted that Hanwha Ocean's decision to withdraw its complaint follows a recent meeting between Hanwha Group Vice Chairman Kim Dong-kwan and Chung Ki-sun, vice chairman of HD Hyundai, amid calls within the shipbuilding community to unite in the face of global market uncertainties.

Many others believe it may have also been prompted by the reelection of former U.S. President Donald Trump, who has expressed support for cooperation with the Korean shipbuilders to deal with increasing challenges posed by China's dominance in global shipbuilding orders.

BY LEE JAE-LIM, YONHAP [lee.jaelim.joongang.co.kr]