After 20 years of lackluster results building commercial vessels for Jones Act trade, Norwegian investment group Aker ASA is selling its Philadelphia shipbuilding operations to Korea's Hanwa Group for $100 million.
Philly Shipyard supplies around 50% of the largest U.S. commercial vessels, including tankers and container ships. In addition, Philly Shipyard constructs training vessels for the U.S. Maritime Administration (MARAD).
Hanwa is understood to be seeking shipbuilding and repair contracts from the US Navy, both for its Korean operations and in North America. Not all observers applaud the move.
Hi Investment & Securities analyst Byun Yong-jin told The Korea Times that Hanwha could be forced to invest a larger amount of money to normalize Philly Shipyard. “It will be difficult to transplant the Korean shipyard’s high efficiency and productivity into the U.S. shipyard.”
The Transaction is subject to the satisfaction of certain customary conditions, including approval by CFIUS (Committee of Foreign Investments in the US) and other regulatory approvals being obtained as well as no material adverse event having occurred in relation to PSI. Subject to satisfaction of all closing conditions, the parties expect that the Transaction will close during Q4 2024.
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