KB News Desk
Hanwha Group is seeking to acquire the US arm of Austal, Australia’s biggest shipbuilding company, in a move to substantially strengthen the South Korean conglomerate’s shipbuilding and defense presence in the US.
Hanwha Defense USA, a US subsidiary of Hanwha Aerospace, said Tuesday it has submitted “a preliminary, non-binding offer to acquire Austal’s US business.”
“Any deal will be contingent on due diligence that permits a thorough evaluation of Austal USA’s operations and financials, including newly disclosed information,” the company said in a statement.
Austal also said in a separate disclosure that it has received an offer of between $1.05 billion and $1.2 billion on a cash and debt-free basis for the acquisition of the business entities and operations of Austal USA.
Its board has granted Hanwha a four-week due diligence period. A final transaction would depend on the completion of due diligence, negotiation of definitive agreements and regulatory approvals in the US.
Hanwha subsequently increased its stake in Austal to 19.9 percent, becoming the company’s largest shareholder. The latest proposal is focused on Austal’s US operations rather than the entire company.
Based in Mobile, Alabama, Austal USA builds vessels for the US Navy and the Coast Guard. It also provides maintenance, repair and overhaul services for the US Navy at its facilities in San Diego.
The company has built Littoral Combat Ships and Expeditionary Fast Transport vessels for the navy, coast guard cutters and auxiliary ships and also produces modules for nuclear-powered submarines.
An acquisition would give Hanwha an expanded production base beyond Philly Shipyard in Philadelphia, which the group acquired in 2024. By leveraging Austal USA’s existing relationships with the US government and Navy, the deal could provide a foundation for Hanwha to expand further into the US Navy’s new ship construction and MRO markets.
Hanwha has been increasing its involvement in US government shipbuilding programs over the past year, including securing work related to a missile-tracking vessel and a design contract for a logistics support ship that supplies fuel and equipment during naval operations.
“Hanwha has made it a priority to significantly contribute to revitalizing American shipbuilding and is exploring a range of options to expand our footprint in the United States,” Hanwha Defense USA said in a statement.
A successful acquisition could also give momentum to the Make America Shipbuilding Great Again initiative, a joint Korea-US effort to revitalize American shipbuilding through investment, technology sharing and workforce training. Under MASGA, Seoul agreed last year to invest $150 billion in the US shipbuilding industry, part of a broader $350 billion investment package in the US.
Observers say acquiring Austal USA, an established naval contractor in the country, could strengthen Hanwha’s ability to participate more broadly in US military shipbuilding and deepen bilateral shipbuilding cooperation under MASGA. It could also secure key manufacturing capabilities within the US Navy’s nuclear submarine supply chain.
