Merger between Daewoo and Hyundai delayed due to COVID-19
Due to the COVID-19 pandemic, the planned merger between Hyundai Heavy Industries and Daewoo Shipbuilding & Marine Engineering in 2020 has become uncertain.
Three times this year, the European Commission has suspended its review of the business mix between Hyundai Heavy Industries and DSME, saying it is difficult to collect data because of the pandemic.
In the midst of the pandemic, the Commission postponed its review twice in March, but resumed it two months later, setting Sept 3 as the deadline.
In six countries, Korea, Europe , Japan, China, Kazakhstan and Singapore, Hyundai Heavy Industries and DSME are obliged to undergo a corporate combination review. The merger between the two companies has so far been approved by only Kazakhstan and Singapore.
Of the remaining four, the EU is the biggest obstacle. Its competition laws are more complex than those of other nations.
If the two companies merge, the unified company will account for 60 percent of the market for LNG carriers, which is much higher than their 21 percent combined market share for all ship types.
Other countries are likely to follow suit if the EU approves the merger, because there are few reasons not to allow it. By the end of 2020, the Korean Fair Trade Commission plans to complete its review.
Maritime Business World