[Courtesy of Hyundai Heavy]
A sweeping corporate overhaul pushed by Hyundai Heavy Industries, the world's largest shipyard, received a favorable response in the market Wednesday, triggering expectations on an early turnaround in its embattled business.
Hyundai's board endorsed plans Tuesday to reorganize the group's bloated structure into six separate entities, to focus on shipbuilding, offshore plant and vessel engines after spinning off five other divisions covering electro electric systems, construction equipment, robotics, green energy and facility support operations.
Hyundai's stock soared more than eight percent in early trading Wednesday with investors and analysts reacting positively to the shipbuilder's restructuring program.
With its business overhaul, Hyundai will be able to reduce its debt and raise its corporate value dramatically, Korea Investment and Securities said, adding Hyundai's robotics division along with Hyundai Oilbank, a lucrative petroleum and refinery unit, is expected to become a holding company or control tower.
South Korean shipyards have struggled with a protracted slump in the global shipbuilding industry. This year, Hyundai and two other leading shipyards were put under creditor-led corporate restructuring to ride out a liquidity crisis through job cuts and the sale of non-core assets.
The country's top three shipyards suffered a combined operating loss of 8.5 trillion won (7.2 billion US dollars) last year. But Hyundai shifted to a net profit of 971 billion won in the January-September period this year from a net loss of 985 billion won a year earlier.
Aju News Lim Chang-won = cwlim34@ajunews.com
reporter
Park Sae-jin
swatchsjp@ajunews.com
