Hanwha Group surpasses 15 percent stake in Korea Aerospace Industries
Fifteen percent is the threshold at which a conglomerate buying into a publicly listed company must file for an antitrust review with the Fair Trade Commission (FTC).
Korea Aerospace Industries' KF-21 fighter, Korea's first indigenous supersonic fighter jet, in South Gyeongsang on May 14
NEWS1
Hanwha Group’s stake in Korea Aerospace Industries (KAI) has passed 15 percent, the threshold at which a conglomerate buying into a publicly listed company must file for an antitrust review.
Hanwha Systems disclosed on Monday that it now holds a 4.98 percent stake in the aircraft maker. That takes the group’s combined holding to 15.89 percent, with Hanwha Aerospace holding a 9.9 percent stake in KAI and Hanwha Aerospace USA a 1.01 percent stake.
The buying followed Hanwha Systems’ plan — first announced on July 8— to acquire up to 500 billion won ($352.7 million) of KAI shares this year. It picked up about 3.45 percent on the open market over the following month.
Hanwha will soon file for a business combination review with the Fair Trade Commission (FTC). In a business combination review, the FTC checks whether an acquisition or merger will damage competition in a market.
KAI’s largest shareholder is the Export-Import Bank of Korea, with 26.41 percent. Hanwha overtook the National Pension Service in June to become the second largest.
The industry expects a light review. Since Hanwha’s stake does not give it any management control over KAI, the FTC can use its simplified procedure.
Hanwha said that it is interested in working alongside KAI.
“As the second-largest shareholder of KAI, we are reviewing ways to expand our synergy through business cooperation […] and to take part in decisions related to supporting the expansion of exports,” the group said.
The defense industry has interpreted this as Hanwha’s intent to acquire KAI outright.
The stake fits a plan the group set out on July 3, when it announced a mid- to long-term “AI space power” strategy to spend 55 trillion won by 2040 on its own launch vehicles, satellites and facilities, including space AI data centers. The plan calls for a space and aviation belt that would link Changwon in South Gyeongsang, where Hanwha Aerospace is based, with Sacheon in South Gyeongsang, home to KAI’s headquarters, and Goheung in South Jeolla, the site of the Naro Space Center.
“Only when space, aviation, AI and defense are connected as one can we make the leap to a true AI space power,” Kim Dong-kwan, the executive vice chairman of Hanwha Group, said during the strategy announcement on July 3.
BY KO SUK-HYUN [cho.yongjun1@joongang.co.kr]
This article was originally written in Korean and translated by a bilingual reporter with the help of generative AI tools. It was then edited by a native English-speaking editor. All AI-assisted translations are reviewed and refined by our newsroom.
