Philly Shipyard, a US tanker and cargo construction company, has announced it has entered a $100m share purchase agreement with Hanwha Systems and Hanwha Ocean, two arms of the South Korean defence group, on 20 June 2024.
Currently under the ownership of the Norwegian-based industrial investor Aker Group the shipyard has served as a shipbuilder for a range of maritime vessels, often containers and tankers.
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“After two decades of stewardship, it is with great honour that we transition the ownership from Aker to Hanwha,” said Kristian Røkke, chairman of Philly Shipyard ASA. “Recognised as a global leader, Hanwha brings a wealth of sophisticated shipbuilding experience that will enable Philly Shipyard to realise a grander vision for its employees and customers.”
This deal does not stand in isolation. Rather, it is the latest move from a ballooning South Korean defence industry eager to invest in US maritime facilities. It builds on a foundational visit made by the US Secretary of the Navy, Carlos del Toro, to Hyundai Heavy Industries in Japan and Hanwha in Korea at the end of February.
At the time Del Toro’s office noted that “discussions were very productive and centered on attracting Korean investment in integrated commercial and naval shipbuilding facilities in the United States.”
Del Toro welcomed the news, stating “Hanwha’s acquisition of Philly Shipyard is a game-changing milestone in our new Maritime Statecraft.
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By GlobalData“This will bring good paying union jobs to Philadelphia, a city with a 250-year relationship with the US Navy. Knowing how they will change the competitive US shipbuilding landscape.
“I could not be more excited to welcome Hanwha as the first Korean shipbuilder to come to American shores—and I am certain they will not be the last.”
Korean industry shapes US Maritime Statecraft
This new, somewhat ambiguous term – Maritime Statecraft – has come to define del Toro’s time as head of the Navy.
During remarks at the John F. Kennedy School of Government at Harvard University in September 2023, he explained that China’s naval growth is matched by its commercial maritime power, which means that the superpower has established an ownership stake in 95 ports across 53 countries.
Maritime Statecraft is a proposal to reverse the “operational and economic risk for the American economy,” but how will Korean industry support this aim?
The US Navy have been eyeing Japan and South Korea industry for some time to support the US naval industrial base, which is under significant strain, by providing additional capacity and resources to outmatch China in their naval arms race.
Furthermore, only a few months prior to the share purchase, Philly Shipyard signed a memorandum of understanding with Hyundai Heavy Industries. The two companies will explore a relationship relating to future US government shipbuilding projects as well as maintenance, repair and overhaul projects.
