Austal and Cerberus said to be eyeing acquisition of former HHIC Philippines yard

There have been worries that strategically located yard could come under Chinese control

Nikkei Asian Review reports that a consortium of U.S. private equity firm Cerberus Capital Management and Australian shipbuilder Austal is in exclusive talks to acquire the strategically located Cebu, Philippines, shipyard formerly operated by South Korea’s Hanjin Heavy Industries.

The VLCC-scaled yard is on the site of the former U.S. Navy Subic Bay base and there have been fears that it could be bought by Chinese interests. An acquisition by Austal and Cerberus would security concerns over national security that have been triggered by the Chinese interest in the shipyard.

Nikkei Asian Review cites Austal CEO David Singleton as saying that his company and Cerberus have been in exclusive talks with the creditors of the bankrupt shipyard.

The team was expected to finish due diligence in the next three months, after which the bid price and structure of the joint venture would be known, Singleton said. An official from Cerberus and a representative from the creditors did not immediately respond to a request for comment.

“They (Cerberus) will do the financials. We will do shipbuilding and ship repair and the [Philippines] Navy will do their own thing,” Nikkei Asian Review quotes Singleton assaying . “We like the Navy there.”

Asked to confirm information from government sources that a Japanese company will join their consortium, Singleton said: “Maybe in the future, but not now.”

Austal already builds small and mid-size passenger vessels at its own, very much smaller, Cebu shipyard.

Austal could use the Hanjin yard to build larger vessels, such as LHD ships and frigates, Singleton is quoted as saying,

Read the Nikkei story HERE