Hanwha Group has offered to acquire Austal’s U.S. shipbuilding operations for as much as $1.2 billion, as the South Korean conglomerate looks to expand its presence in the U.S. defense shipbuilding market.
The nonbinding proposal from Hanwha Defense USA values the business at between $1.05 billion and $1.2 billion. Austal has given the South Korean company four weeks to examine its U.S. operations and financial records before deciding whether to proceed.
“Any deal will be contingent on due diligence that permits a thorough evaluation of Austal USA’s operations and financials, including newly disclosed information,” Hanwha Defense USA's director of strategic communications James Hewitt said in a statement. “Hanwha has made it a priority to significantly contribute to revitalizing American shipbuilding and is exploring a range of options to expand our footprint in the United States.”
The proposed transaction would not include Austal’s operations in Australia, the Philippines or Vietnam, or its shares listed in Sydney. Austal said the offer would not affect its Strategic Shipbuilding Agreement with the Australian government.
Austal USA designs and builds vessels for the U.S. Navy and Coast Guard. The business accounted for 90% of Austal’s $76.6 million in pretax profit during fiscal year 2025.
The latest approach follows Hanwha’s unsuccessful attempt to purchase all of Austal in 2024. Austal rejected that offer in April of that year, saying it was uncertain whether a transaction could secure the necessary approvals from U.S. and Australian regulators.
At the time, Austal left the door open to renewed discussions if Hanwha could demonstrate that regulators would approve a deal. Hanwha challenged Austal’s assessment of the regulatory risks before abandoning the proposal in September 2024.
Hanwha continued its expansion into U.S. shipbuilding through its acquisition of Philly Shipyard. The company announced the $100 million deal with former owner Aker ASA in June 2024 and completed the purchase later that year. The Philadelphia yard constructs commercial and government vessels.
Hanwha maintains that it holds a 19.9% interest in Austal. Austal lists Hanwha’s position as a 9.9% direct shareholding combined with a cash-settled equity swap tied to another 9.9%. Australian regulators approved a potential increase in Hanwha’s direct ownership to 19.9% in December 2025, with conditions governing security and access to company data.
The acquisition proposal arrives as Austal anticipates a difficult financial year for its U.S. division. The company expects Austal USA to post an $123.5 million operating loss for fiscal year 2026 because of mounting losses on shipbuilding programs, according to Reuters.
Reuters reported that Austal forecasts a group operating loss of $79.8 million for the year, compared with operating earnings of $80.1 million in fiscal year 2025.
