The merger, announced on July 15, is expected to solidify HD Korea Shipbuilding’s position as the world’s top player in the shipbuilding and marine engine markets.
With the acquisition, HD KSOE will secure a 70 percent share in the domestic ship engine market and a 37 percent share in the global market. Its closest competitor, Hanwha Engine Co., controls 30 percent and 13 percent of the domestic and global markets, respectively.
Following the merger, STX Heavy Industries is scheduled to be renamed HD Hyundai Marine Engine Co. The company will hold a shareholders' meeting on July 30 to vote on the name change and appoint new board members.
To address competition concerns, the Fair Trade Commission imposed conditions on the merger for a three-year period. These include prohibiting the refusal to supply crucial engine parts, guaranteeing minimum supply volumes, limiting price increases and preventing delivery delays to competing engine manufacturers.
The Fair Trade Commission said that the conditions aim to "maintain fair competition in the shipbuilding industry and related intermediate markets, which are key national industries," while allowing the merged entity to pursue its goal of strengthening competitiveness in the global engine market through investments in eco-friendly technologies.
