Hyundai Heavy Industries to be Split
South Korea's Hyundai Heavy Industries is being split into four companies, with its non-shipbuilding businesses being spun off to improve management efficiency and competitiveness, the shipbuilder said on Tuesday.
South Korean shipbuilders have been selling non-core assets and slashing jobs to cope with shrinking orders from the oil industry that forced the firms into heavy losses last year.
Under the plan, Hyundai Heavy Industries will be divided into four companies. It will retain core businesses, including shipbuilding, offshore and industrial plant, while three other firms will focus on electro electric systems, construction equipment and robot business, the company said in a statement.
Existing Hyundai Heavy Industries stakeholders will be get around 0.75 shares of the company and shares in each of the three other entities.
The spinoff is part of its restructuring plan submitted to creditors.
The three newly created companies will seek listings on the stock market. The company expects the separation to be completed on April 1, 2017.
South Korea is home to the world's three largest shipbuilders - Hyundai Heavy Industries, Daewoo Shipbuilding & Marine and Samsung Heavy Industries. Around 3,000 employees left the three shipbuilders in the third quarter this year alone due to restructuring in the shipbuilding industry. The number is expected to increase in the future.