Newbuilding contracts for two LNG carriers have been put on hold at Daewoo Shipbuilding & Marine Engineering as incoming new owner Hanwha Group reviews recently signed deals.
Industry sources tuned into the Hanwha takeover said a single contract for Maran Gas Maritime and another one-ship order for Mitsui OSK Lines are not currently moving forward.
One described the business as “cancelled”. Another suggested it should more accurately be described as “temporised” while Hanwha audits all the shipbuilder’s contracts.
The two single-ship deals were signed with the owners in early November after GasLog walked away from some berths it was holding at the yard.
At the time, DSME confirmed the 2026-delivering orders, which were priced in the region of $250m each, but did not name the shipowners behind the contracts.
Optional units
Greece’s Maran Gas had also been sitting on two optional LNG carrier slots that the shipowner had been expected to declare before the end of 2022.
Maran Gas does not comment on its commercial business activities.
MOL has been contacted about its LNG newbuildings.
DSME said in its December investor relations presentation: “DSME are adopting a new strategy of receiving shipbuilding orders primarily considering profit margins.”
South Korean defence and energy conglomerate Hanwha inked its deal on 16 December to take over a controlling stake in DSME for KRW 2trn (then $1.4bn) from Korea Development Bank (KDB).
At the time, Hanwha management said the deal was expected to be completed by mid-2023.
Hanwha representatives are understood to be moving into a building at the yard.
The mood among DSME employees was described by one yard associate as “cautious” with the marketing team unable to compete aggressively on new contract work.
Review process
Those following the takeover at close quarters said Hanwha has extended the contracts of the shipyard employees until the end of March this year while it conducts its reviews.
Hanwha, which made an earlier attempt to take over DSME in 2008, is South Korea’s seventh-largest conglomerate.
Following the buyout, Hanwha now holds a 49.3% stake in the shipbuilder and has managerial control over the yard. KDB’s former 55.7% stake in DSME is set to be cut to 28.2% within the first half of this year.
KDB and the Export-Import Bank of Korea have agreed to extend soft loans to the company for a short period following the buyout.
DSME, which has specialised in LNG carrier construction, said in December that it achieved just over 116% of its $10.4bn new order target for 2022. The figure included 38 LNG vessels worth around $8.4bn. The balance was made up of container ships, offshore units and naval work.
