Fair Trade Commission approves Hanwha's acquisition of additional KAI stakes

Korea’s fair trade watchdog on Monday approved Hanwha Group’s recent acquisition of additional stakes in Korea Aerospace Industries (KAI). 

The Fair Trade Commission’s (FTC) approval came after Hanwha Systems recently purchased a 3.45 percent stake in KAI, raising Hanwha Group’s combined stake in the aircraft manufacturer to 15.89 percent, including the 9.9 percent held by Hanwha Aerospace. 

“KAI’s largest shareholder is the Export-Import Bank of Korea, which has a 26.41 percent stake, and the National Pension Service holds 8.75 percent,” the FTC said.

“At this stage, we’ve concluded that Hanwha Group’s 15.89 percent stake is not sufficient to exercise substantial influence over KAI’s overall management.”

The FTC, however, noted that it would conduct another merger review if Hanwha becomes KAI’s largest shareholder or if Hanwha executives concurrently account for at least one-third of KAI’s executives.

KAI, Korea’s sole aircraft manufacturer, produces the KF-21 advanced fighter jet, the FA-50 light combat aircraft and its trainer variants and the Surion and Miron helicopters.

Hanwha Group has been increasing its hold on KAI as part of its broader ambition to establish an integrated aerospace and defense ecosystem spanning aircraft, satellites, launch vehicles, ships and other high-tech defense systems.

Yonhap