The world’s largest shipbuilder Hyundai Heavy Industries split its non-shipbuilding businesses into three separate companies, in attempt to improve management efficiency and competitiveness. The spin-off is part from the restructuring plan approved by the creditors and South Korean government. The company will keep the management of the core businesses including shipbuilding, offshore and industrial plant, while the divisions of electric systems, construction equipment and robot business will be separated into three different companies. The existing stakeholders will be get around 0.75 shares of the core-business company and shares in each of the three other entities.
“There was inefficiency because our management was centered on shipbuilding and it was difficult for other business that record smaller sales to secure individual competitiveness”, said the official statements of Hyundai Heavy Industries.
The three newly created companies will seek listings on the stock market. Hyundai Heavy Industries expects the separation to be completed until April 1, 2017.
Hyundai Heavy Industries is world’s largest shipbuilder, headquartered in Ulsan, South Korea. The company has 25,000 employees and register revenue of 39.33 billion USD in 2015. Unfortunately the crisis in shipping business, as well as low oil prices, caused reduction of the number of new orders to the builder. This immediately turned the company into loss and increasing debt. During the last years, the South Korean government is working on restructuring and optimization of the Hyundai Heavy Industries’ business, as well as improvement of its liquidity.