The Defense Acquisition Program Administration, or DAPA, completed its evaluation of proposals for the detailed design and construction of the lead ship for the Korean Destroyer Next Generation, or KDDX, and notified Hanwha Ocean and HD Hyundai Heavy Industries of the result later in the day, according to defense industry sources.
Hanwha Ocean reportedly beat HD Hyundai Heavy Industries by just 0.5867 points.
The KDDX project, worth about 7.8 trillion won ($5.1 billion), calls for building six 6,000-ton-class Korean Aegis destroyers by 2030. The program has been considered one of South Korea’s most important naval acquisition projects, aimed at strengthening the Navy’s air defense and maritime combat capabilities with domestically developed systems.
With the preferred bidder status, Hanwha Ocean is expected to enter talks with DAPA to proceed with the detailed design and lead ship construction. However, the schedule could face further delays if HD Hyundai Heavy Industries files an objection or pursues additional legal action.
The competition has been marred by years of disputes between the two shipbuilders over design rights, security penalties and allegations of military secrets leakage.
HD Hyundai Heavy Industries previously filed an injunction, claiming that 14 out of 170 basic design data items attached to a request for proposals distributed by DAPA to Hanwha Ocean in March contained trade secrets.
The company appears to have lost ground in the evaluation due to the security penalty related to a military secrets leakage case. Nine HD Hyundai Heavy Industries employees were indicted for secretly photographing and sharing military secrets, including KDDX concept design materials prepared by Daewoo Shipbuilding & Marine Engineering, which was later acquired by Hanwha Ocean. Eight were convicted in November 2022 and one in December 2023.
The KDDX program has been delayed for nearly two years due to disputes over the selection process and the long-running feud between the two companies. Daewoo Shipbuilding & Marine Engineering handled the concept design before being acquired by Hanwha Ocean, while HD Hyundai Heavy Industries carried out the basic design.
Shares of Hanwha Ocean closed at 112,700 won on Friday, up 8,200 won, or 7.85 percent, from a day earlier.
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