Austal looking to take over HHIC
A report by Nikkei Asian Review says that Australian shipbuilder Austal and Cerebus Capital Management a US private equity firm are in talks to takeover the financial troubled HHIC yard in Subic Bay in the Philippines.
According to the report, Austal CEO David Singleton told Nikkei Asian Review that his company and Cerberus were in exclusive talks with the creditors of the Philippine unit of South Korea’s Hanjin Heavy Industries and Construction, which had owned the shipyard for 13 years before it collapsed. The team was expected to finish due diligence in the next three months, after which the bid price and structure of the joint venture would be known, Singleton said. An official from Cerberus and a representative from the creditors did not immediately respond to a request for comment.
If successful, the bid would allay fears of Chinese involvement with the yard which The Philippine Navy had feared would give China a strategic foothold in the region, Subic Bay was formerly a US naval base and opens to the South China Sea.
Austal is no stranger to the Philippines as it already has a facility there. Austal Philippines was established in Balamban, Cebu in 2012 with the vision to become Austal’s global centre of excellence for commercial shipbuilding. Austal Philippines has completed a number of major commercial contracts for vehicle-passenger ferries and offshore support vessels. This week it was announced that the yard had won a contract for six new Philippine Navy ships as part of the modernisation programme of the Armed Forces of the Philippines and had also inaugurated a new facility at the yard for larger vessels.
Austal has a track record of building naval vessels with ships produced for the Australian and US armed forces as well as patrol craft for other nations. Acquisition of the HHIC yard would boost production capacity and allow for larger vessel types to be built.