American investor interest in South Korea’s shipbuilding sector is gaining momentum as Taekwang Group teams up with U.S. private equity powerhouse TPG to pursue a bid for K Shipbuilding. The partners have submitted a letter of intent seeking management control of the Jinhae-based shipyard, placing them among three shortlisted bidders for the asset, which previously operated under the name STX Offshore & Shipbuilding.
Their bid is unfolding at a time when Washington’s Making American Shipbuilding Great Again initiative is widening the field for cooperation with Korean shipyards. K Shipbuilding has attracted notable attention given its close proximity to the Republic of Korea Navy’s Fleet Support Unit and its track record in building naval vessels. The yard is pushing to secure U.S. Navy repair and maintenance work and is eyeing potential contracts that could involve servicing up to 32 vessels annually over the next decade. This prospect has drawn significant interest from American funds seeking strategic exposure in Asia.
Since its acquisition in 2021 by a domestic private equity partnership, K Shipbuilding has mounted an impressive turnaround. The company was formally put up for sale in July, with its owners aiming for a valuation of up to KRW 1 trillion (about $730 million). The planned exit marks a dramatic comeback for a yard that only a few years earlier was on the brink of collapse.
Once regarded as the world’s fourth-largest shipbuilder by orderbook, STX Offshore & Shipbuilding saw its position deteriorate after the 2008 global financial crisis and ultimately entered court receivership in 2016. Its outlook brightened after a consortium led by KHI Investment and United Asset Management Company acquired the business for KRW 250 billion in 2021, betting on renewed global demand for shipbuilding. That bet now appears to be bearing fruit as global investors compete for a stake in its next chapter.
Source: Maritime Gateway
