Hyundai Heavy Industries Group (HHI) is to transfer its LNG shipbuilding technology to medium-sized shipbuilders.
This move is to pave the way for its merger with Daewoo Shipbuilding & Marine Engineering (DSME).
HHI plans to move its LNG technology to STX Offshore & Shipbuilding and Hanjin Heavy Industries.
This will allow a plan to be submitted to the European Commission thus eliminating the possibility of a monopoly. The EC is currently conducting a business combination review on HHI and DSME.
Last year, the EC told HHI to find a solution to remove the possibility of limited competition in the LNG shipbuilding market.
At present, HHI and DSME’s combined share of the LNGC building market is running at around 70%.
The two major shipbuilders announced a merger plan in 2019. South Korea, the European Union and Japan are currently examining the plan and China, Kazakhstan and Singapore have already approved the merger.
However, the EU had expressed concerns over the possibility that the merger would lead to a mega shipbuilder and less bargaining power in the LNGC market.
“It is said that Hyundai Heavy Industries Group and the European Union are continuing with their negotiations and the competition authorities of South Korea and Japan are likely to be affected by the European Commission’s decision,” said an industry source to the Business Korea media outlet.