Hanwha Aerospace to spin off non-core units for defense sector

Hanwha Aerospace Co., South Korea’s answer to Elon Musk’s SpaceX, decided to separate non-core units to concentrate on defense and aerospace businesses – key growth drives of the chemical-to-defense conglomerate Hanwha Group.

Hanwha Aerospace said on Wednesday its shareholders approved its plan to spin off its semiconductor equipment-making unit Hanwha Precision Machinery Co. and security system affiliate Hanwha Vision Co.

Hanwha Aerospace also plans to establish a new holding company dubbed Hanwha Industrial Solutions, which will take 100% stakes in the separated units.

Hanwha Corp., the group’s holding company, is set to hold a 33.95% stake in the new company.

Hanwha Aerospace, the aircraft engine-making unit of Hanwha Group, unveiled the spin-off plan in April.

DEFENSE TROIKA

The spin-off allowed the group to accelerate its defense business led by three units – Hanwha Aerospace, Hanwha Ocean Co. and Hanwha Systems Co.

“We aim to become a global top-tier defense maker and lead the aerospace and new mobility industries,” said Hanwha Aerospace CEO Son Jae-il.

Hanwha Aerospace merged Hanwha Defense Co. in November 2022 and Hanwha Corp.’s defense division in April 2023 to promote synergy and cut costs in the business.

The group also acquired Daewoo Shipbuilding & Marine Engineering Co. (DSME), which manufactures submarines for South Korea’s Navy, in May 2023 and established Hanwha Ocean to expand its defense business into the maritime defense sector.

Write to Hyung-Kyu Kim at khk@hankyung.com
 
Jongwoo Cheon edited this article.