Hanwha Aerospace Co., South Korea’s answer to Elon Musk’s SpaceX, is spinning off its non-core units to focus on defense and aerospace businesses – key growth engines of the chemical-to-defense industry conglomerate.Hanwha Aerospace, the aircraft engine-making unit of Hanwha Group, said in a regulatory filing on Tuesday that it plans to spin off Hanwha Precision Machinery Co. and security system affiliate Hanwha Vision Co. and place the two units under a new holding company.The spin-off is aimed at improving shareholder value and management efficiency, the company said.The plan will likely be submitted to a company board meeting for approval on Friday, sources said.Following the spin-off, Hanwha Aerospace will file a share relisting review request with the Korea Exchange, they said.Shares of Hanwha Aerospace surged on the spin-off news, closing 15.3% higher at 241,000 won on Tuesday. In early Wednesday trade, the stock was 8.3% lower.DEFENSE, AEROSPACE PROJECTS IN FOCUSCurrently, Hanwha Aerospace has four subsidiaries under its wing – defense and satellite service unit Hanwha Systems Co., satellite maker Satrec Initiative Co., Hanwha Precision Machinery and Hanwha Vision.Company officials said they expect the spin-off to provide non-core units with opportunities to be fairly valued as independent entities by investors in the market.Hanwha Group has been spending heavily on its aerospace business since the launch in 2020 of Space Hub, a group-wide task force handling all future mobility-related projects.The task force is led by Kim Dong-kwan, the eldest son of Hanwha Chairman Kim Seung-youn and the group’s heir apparent.In 2022, Hanwha Aerospace absorbed Hanwha Defense Co. to promote synergy and cut costs in the defense and aerospace businesses.Last year, the conglomerate acquired Hanwha Ocean Co., the world’s third-largest shipbuilder.Hanwha Ocean, formerly Daewoo Shipbuilding & Marine Engineering Co. (DSME), is the only Korean company that has built submarines for the country's Navy since 1987.Hanwha Ocean is seeking to acquire a controlling stake in Australian shipbuilder Aural for A$1.02 billion ($662 million), according to a Reuters report on Tuesday.Austal is a prime contractor designing, constructing and sustaining ships for the US Navy.Industry watchers said the spin-off plan is part of Hanwha Group's bid to streamline its governance structure as it prepares for management control transfer to Kim Seung-youn’s sons.In March 2023, Hanwha Solutions Corp., a renewable energy affiliate, spun off Hanwha Galleria, placing the new company under the control of Kim Dong-seon, the chairman’s third son.A Hanwha Group official said Hanwha Aerospace’s spin-off plan has nothing to do with the talked-about management transfer. (ICE SEOUL)

Fonte notizia: The Korea Economic Daily