News Column

Samsung's Shipbuilding, Engineering Units To Merge

August 31, 2014

SEOUL (dpa-AFX) - South Korean conglomerate Samsung Group's shipbuilding and engineering units will merge to strengthen the conglomerate's offshore business, the two units said Monday. Samsung Heavy Industries Co. Ltd. will merge with Samsung Engineering Co. Ltd.

Samsung is currently on a restructuring drive, and the merger of the two units hints at an acceleration of its ongoing restructuring efforts. The company is facing difficult times due to the poor health of its Chairman Lee Kun-hee, who was hospitalized following a heart attack in May.

Under the merger, shareholders of Samsung Engineering will get 2.36 shares in Samsung Heavy Industries. The companies expect the merger to be effective from December 1, 2014.

Samsung Heavy is the world's second-largest shipbuilder. In a regulatory filing, the unit said the merger will result in a combination of shipbuilding and marine-plant business with Samsung Engineering's competitive edge in designing, purchasing and managing plant-related projects.

The two companies had combined annual revenue of about 25 trillion won in 2013 that is expected to rise to 40 trillion won by 2020.

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Source: dpa-AFX International Compact

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