Hanjin takeover talks may be finalized in 2 months

Negotiations for the takeover of Hanjin Heavy Industries and Construction Philippines’ shipyard in Subic may be finalized within two months, Australian Ambassador to the Philippines Steven Robinson said in an online briefing.

“There has been some work going on over the last couple of years now with respect to the Subic Bay facility and that involves (Australian shipbuilder) Austal and a number of other entities, and I am hopeful that there will be some progress made in the next month or two that will see a finalization of all those negotiations,” he said.

“It’s still kind of commercially in confidence. So I can’t get too much into detail. But nevertheless, let’s hope there is a positive outcome which will see Austal expand further in the Philippines,” Robinson said.

Austal and US private equity firm Cerberus Capital Management have teamed up and expressed interest to take over Hanjin’s facility in Subic.

Hanjin started operations at the Subic facility in 2006, but declared bankruptcy in 2019.

Robinson said Austal is committed to invest further in the Philippines and to become the shipbuilder of choice in the region.

“And that Hanjin facility, if that comes to the fore, would be a marvelous way to enable that in conjunction with its facility that it already has invested significant funds down in Cebu,” Robinson said.

Austal, which started operating its facility in Balamban, Cebu in 2012, currently has 900 local employees.

Apart from interest in the Hanjin facility in Subic, Austal has also offered to build offshore patrol vessels for the Philippine Navy as part of the Armed Forces of the Philippines’ modernization program.

“We have great aspirations to increase the local technology which we are transferring, and we see further projects over the next few months which we hopefully would have the position to provide positive updates in due course. Specifically, I am referring to the offshore patrol program of the Philippine Navy. This is a fantastic and exciting program not just for the Philippine Navy, but also for Austal and Australia,” Austal regional director Dave Shiner said.

As part of the transfer of technology, he said Austal is actively looking at setting up in-service support teams to enable ongoing support, repair, and maintenance for the Philippine Navy or Philippine Coast Guard.

On the disputed South China Sea, Robinson said he is hopeful the current situation would not affect trade.

He said Australia’s position is that all countries should subscribe to the rules, norms and the laws that govern the free passage through international waters.

“And so therefore, we are concerned if there is any action taken by any country that seeks to inhibit that free passage and the freedom of navigation, and if we see anything unfortunate along those lines then, Australia will express its views which we have done in the past and will continue to do so,” he said.