By Kim Yoo-chul
Staff Reporter
After POSCO having expressed its intention to make an independent bid for Daewoo Shipbuilding & Marine Engineering (DSME), concerns have risen that the possible acquisition might hurt ``fair competition’’ among shipbuilders.
Experts say the acquisition, if realized, is highly likely to prompt the world’s fourth-largest steel maker to create a monopoly in the steel industry at a time when steel prices for constructing vessels are unexpectedly high due to a supply and demand imbalance.
``South Korean shipbuilders now face strong challenges from Chinese rivals as there is no guarantee that Korean players will maintain their current dominant position ahead of competitors in a decade,’’ said an analyst at a foreign brokerage here, Thursday.
``That’s why I can say local shipbuilders are needed to join forces to realize the `economies of scale’,’’ the analyst, who asked not to be identified, said.
However, it seems unlikely for now that any of the big local players will make an independent bid for the world’s No. 3 shipbuilder because of external and internal reasons.
``We are not especially interested in the acquisition,’’ a high-ranking official from Hyundai Heavy Industries, the world’s No. 1 shipyard, said.
Samsung Heavy Industries ruled out the possibility, saying that the company is busy tackling the Samsung bribery scandal and the ongoing feud over the oil spill near Taean, South Chungcheong Province.
The accident occurred on Dec. 7 when a Samsung Heavy Industries barge carrying a construction crane snapped its cables to two tugs in rough seas and rammed the anchored 140,700-ton tanker, devastating scores of marine farms and miles of beaches.
STX, the world’s No. 5 shipbuilder, has been facing investigation by the European Union over possible problems with its recent Norwegian shipyard Aker Yards ― a cruise provider.
Furthermore, Italian Fincantieri has reportedly been told to place an offer for at least 51 percent in Aker Yards and was planning a share issue in connection with the offer. The purpose should be to avoid a takeover of Aker Yards by STX.
``If POSCO makes an independent bid, then we will pull the plug,’’ an STX official said.
A month ago, POSCO Chairman Lee Ku-taek clarified that the company has much interest in acquiring DSME but denied the possibility of a joint purchase with other steelmakers. POSCO officials say some 3 trillion won has been set aside for extra expenses in POSCO’s investment plan this year.
South Korean shipbuilders maintain their upward momentum thanks to steady orders for highly profitable ships despite lowered margins.