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Highlights
- Austal questions Hanwha’s claim of U.S. regulatory approval
- Shares of Austal surged over 6% amid deal uncertainty
- Pending decision from Australia’s FIRB could shape next steps
ASX-listed shipbuilder Austal (ASX:ASB) has raised concerns over claims made by South Korean defence giant Hanwha Group regarding regulatory clearance from U.S. authorities. This development reopens a high-profile narrative that began last year when Austal rebuffed a full acquisition bid, citing potential hurdles with global regulatory bodies.
Background on the Hanwha Stake Expansion
Hanwha, which currently holds a 9.9% stake in Austal (ASX:ASB), is aiming to increase its holding to 19.9%. The company is presently awaiting responses from the Australian Foreign Investment Review Board (FIRB) and Treasurer Jim Chalmers on this proposed equity expansion.
However, a twist emerged when Hanwha informed Austal that the U.S. Committee on Foreign Investment in the United States (CFIUS) had allegedly approved an increase of its shareholding to up to 100%. This claim is particularly significant, as Austal has major operations based in the United States—adding a layer of regulatory complexity due to national security implications.
Austal Seeks Independent Verification
In an ASX announcement, Austal clarified that it is currently seeking written confirmation from CFIUS to verify the approval that Hanwha claims to have received. Informal discussions have raised discrepancies, with Austal indicating that the nature of the approval might not align with Hanwha’s interpretation.
This issue draws renewed attention to last year’s scenario, where Austal declined a $1.02 billion takeover offer from Hanwha. The decision at the time was largely influenced by expectations that such a proposal would not be successful under regulatory scrutiny—particularly in the U.S.
Market Reaction and Broader Context
Following this announcement, shares of Austal surged by 6.8% to $6.16 as of 11:34 am AEST, reflecting renewed investor interest and speculation over the next steps. The stock’s performance places it among notable movers on the S&P/ASX200, with stakeholders closely monitoring regulatory updates.
The situation has also reignited conversations among market participants around ASX dividend stocks, especially companies operating in strategically sensitive sectors such as defence and infrastructure.
Looking Ahead
While Hanwha’s ambitions remain robust, the lack of verified regulatory clearance adds uncertainty to the process. Austal has committed to updating shareholders once official documentation is received from U.S. authorities. Until then, the market remains cautious but engaged, watching both domestic and international regulatory bodies for cues on the potential reshaping of Austal’s shareholder base.
