The labour union at Hyundai Heavy Industries, demanded from the company to provide job guarantees to its employees if it wants to go ahead with the takeover of Daewoo Shipbuilding & Marine Engineering (DSME). Namely, during January, Korea Development Bank (KDB), DSME’s largest shareholder, signed an MoU with Hyundai Heavy Industries to sell its stake.
Daewoo Shipbuilding’s labour is also concerned that the takeover will cause extended layoffs, something that Hyundai Heavy’s workers have also mentioned.
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In fact, according to the Hyundai Heavy labour union, the relations between the management and the labour could get worse if the first proceeds with the takeover without guaranteeing current jobs. It also added that it should stop the closed-door negotiations, and promise the union’s participation in the takeover process.
South Korean Hyundai Heavy Industries, the biggest shipbuilding group globally, expressed its interest on buying, the second-placed, Daewoo Shipbuilding and Marine Engineering Co Ltd (DSME), during January. If the purchase was to proceed, HHI would control more than 20% of the global market, according to Reuters. Also, Korea Development Bank (KDB), the biggest shareholder of DSME, reported, on January 31, that it has signed a conditional deal with Hyundai Heavy Industries Group to sell Daewoo shares.
HHI’s decision comes as the shipbuilding field recovers from a global economic fall, that resulted to job cuts in 2017, a $2.6 billion bailout of Daewoo Shipbuilding & Marine Engineering Co Ltd.
Hyundai Heavy has issued a letter of intent to KDB to purchase a part of Daewoo, as stated by Yonhap Infomax.
The bank noted in a statement that it signed a MoU with Hyundai that includes liquidity support of 2.5 trillion won ($2.25 billion) for Daewoo. Additionally, the bank owns a 55.7% part of Daewoo.
