Shareholders of Hyundai Heavy Industries (HHI) have approved the South Korean shipbuilder's split-up plan amid fierce opposition from its labor union.
According to local media reports, Hyundai Heavy Industries, , South Korea's largest shipbuilder, is now divided into mid-holding companies and subsidiaries engaged in shipbuilding, special ship, offshore plant, engine and machinery business.
HHI changed its name and mission to the Korea Shipbuilding & Marine Engineering Co., Ltd. (KSME) and decided to use Hyundai Heavy Industries (HHI) as its new subsidiary.
KSME will be a listed company with a 100% shareholding in the newly-split company.
HHI, a new company, will become an unlisted corporation.
The split is the first step in the process of Hyundai Heavy's proposed merger with Daewoo Shipbuilding & Marine Engineering (DSME).
HHI intends to complete the acquisition of DSME by issuing a business combination report to the Fair Trade Commission next month.
Hyundai Heavy had an order backlog totaling 11.14 million compensated gross tons (CGTs) in 2018, the largest among rivals. The comparable figure for Daewoo Shipbuilding was 5.84 million CGTs. Their combined order backlog accounts for 21.2 percent of the total around the globe.