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The Australian government has approved a foreign investment decision to allow South Korean defence giant Hanwha to increase its shareholding in Austal Limited from 9.9 per cent to 19.9 per cent, subject to strict conditions.
Australian Treasurer Dr Jim Chalmers announced on December 12 that the government had agreed to clear a recommendation from the Foreign Investment Review Board to not object to Hanwha’s proposal.
“It follows a thorough and robust process that took account of all the relevant economic, national security and other national interest issues,” Treasurer Chalmers said.
“Hanwha would remain a minority shareholder under this proposal and cannot increase its shareholding above 19.9 per cent.
“This decision ensures there are greater protections for our strategic shipbuilder and the government’s sovereign interests in Austal.
“It is entirely consistent with FIRB’s unequivocal advice not to object to the proposal, subject to conditions.
“It incorporates advice from relevant agencies, including the Department of Defence, the Department of Home Affairs, the Department of Foreign Affairs and Trade and our national security agencies.”
If the proposal goes ahead, it would be subject to a number of strict conditions relating to governance and data information and security, including limits on Hanwha’s access to sensitive information, limits on the storage of sensitive information and stringent criteria on any Hanwha nominee to Austal’s board.
“These conditions build on the strong safeguards that already apply to Austal Defence Australia as Australia’s strategic shipbuilder,” Treasurer Chalmers said.
“Austal is an Australian‑based global leader in shipbuilding and defence capability. It will continue to play an instrumental role in building Australia’s defence industry, strengthening our supply chains and boosting our skills and economic resilience.
“It is a key pillar of our plan to boost local manufacturing and industry capabilities and remains an essential part of our Future Made in Australia agenda.
“This decision and associated conditions will protect our sovereign interests in this capability and ensure the company can continue to grow, invest and deliver continuous shipbuilding in Western Australia.
“Australia welcomes foreign investment and operates a non‑discriminatory foreign investment framework to ensure foreign investment is in our national interest.”
