Hyundai Heavy’s due diligence of DSME hit by protests

Hyundai Heavy Industries (HHI) is not finding it at all easy in its pursuit of compatriot yard Daewoo Shipbuilding & Marine Engineering (DSME).

Continued strikes and protests at both yards have made headlines in recent months since Seoul gave HHI its blessing to take over DSME.

Last week despite violent scuffles, HHI shareholders voted in favour of splitting the group into a holding company and its shipyard operations as part of plans to press ahead with the DSME takeover, a merger that would create a super yard, unparalleled in modern shipbuilding history with a 21.2% global market share.

HHI has now run into its latest hurdle regarding DSME with an inspection team of 20 HHI officials due to carry out due diligence of DSME this week barred from entry to the yard. DSME union members barred the inspection team at six different entries to the shipyard yesterday and are doing the same again today. The inspection team are on Geoje island where DSME’s main yard is based through to June 14 with workers vowing to bar their entry.

Workers are worried that the merger between the two giant shipbuilders will result in more job cuts. More than 30,000 people have been laid off at both yards over the last four years.

Sam Chambers

Starting out with the Informa Group in 2000 in Hong Kong, Sam Chambers became editor of Maritime Asia magazine as well as East Asia Editor for the world’s oldest newspaper, Lloyd’s List. In 2005 he pursued a freelance career and wrote for a variety of titles including taking on the role of Asia Editor at Seatrade magazine and China correspondent for Supply Chain Asia. His work has also appeared in The Economist, The New York Times, The Sunday Times and The International Herald Tribune.
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