Hanwha Group (000880.KS) has raised its stake in Korea Aerospace Industries (KAI) (047810.KS) to 9.04%, becoming the second-largest shareholder after the Export-Import Bank of Korea (26.41%). Having invested 500 billion won in purchasing KAI shares so far, Hanwha Group plans to invest an additional 500 billion won by year-end to raise its stake to 12%.
Hanwha Aerospace (012450.KS) said in a regulatory filing Monday that it had purchased an additional 853,813 KAI shares for a total of 138.9 billion won, securing a combined 6.50% stake. Hanwha Systems (272210.KS) also acquired about 920,000 additional KAI shares for 125 billion won, raising its stake to 1.53%. Adding the 1.01% held by Hanwha Aerospace USA (HAUSA) brings Hanwha Group's total stake to 9.04%. With this, Hanwha Group achieved ahead of schedule its plan announced on the 4th of last month to "invest 500 billion won by year-end to purchase additional shares."
Hanwha Aerospace held a board meeting that day and resolved to invest an additional 500 billion won by year-end, lifting its current 6.50% KAI stake to 9.97% (based on the June 15 closing price of 147,600 won). If this plan is realized, Hanwha Group's KAI stake will exceed 12%.
Currently, KAI's largest shareholder is the Export-Import Bank of Korea, which holds 26.41% (25,745,964 shares) of the total issued shares (97,475,107). The previous second-largest shareholder was the National Pension Service with 8.75% (8,528,099 shares), but the ranking changed following Hanwha's additional purchases.
Earlier, Hanwha invested 930 billion won from November last year through this March to secure a 4.99% stake in KAI, then acquired an additional 100,000 shares on the 4th of last month to become a shareholder holding "more than 5%." At that time, it also shifted its holding purpose from "simple investment" to "management participation," formalizing the possibility of joining KAI's board.
The industry interprets this as Hanwha's attempt to build an "integrated defense portfolio" by connecting KAI's space and aerospace assets to Hanwha's land, sea, and air defense capabilities. Some analysts also suggest the move is intended to prepare for the possible privatization of KAI, which is effectively a quasi-state-owned company.
Hanwha cited "strengthening the competitiveness of Korea's space and aerospace industry" as the reason for the stake expansion. "Amid intensifying global competition in the space industry, represented by SpaceX, the domestic space and aerospace market is limited in scale, and multiple companies are making overlapping investments, constraining competitiveness in development and operation," Hanwha said. "If the technologies and capabilities held by Hanwha and KAI are combined, inefficiencies will be eliminated and synergies will arise, enhancing the nation's space and aerospace industry competitiveness." Hanwha has continued to invest in fields such as aircraft engines, avionics, radar, satellites, space launch vehicles, and ground defense, generating business results, while KAI is the nation's only complete aircraft developer and manufacturer with technological capabilities in areas such as satellite development and aerial combat systems, meaning strengthened cooperation between the two companies can create synergy.
