[Yonhap Photo]
From now, Hyundai Heavy Industries (HHI), which is already the world's largest shipbuilder based in the southeastern industrial city of Ulsan, will quicken legal procedures to acquire Daewoo Shipbuilding & Marine Engineering (DSME) by the end of this year, although union leaders shouted "Foul play" and threatened to wage a legal battle.
"The material division is a decision to raise HHI's capacity and value as much as possible and make a fresh leap through a business combination with DSME," HHI president Han Yeong-seok told a shareholders meeting on Friday that followed a tense standoff with thousands of unionized workers.
At the shareholders meeting, 72.2 percent of voting shares were present, with 99.8 percent of them supporting a corporate split. HHI's labor union argued the meeting was invalid because employee shareholders were not present.
Outside the sprawling seaside shipyard, workers wearing red headbands, backed by a barricade set up with about 1,000 motorcycles, blocked off the road leading to a four-story building where shareholders were to gather when about 500 shareholders, lawyers, security personnel and company officials wearing white helmets and gray work jackets showed up early in the morning.
Thousands of riot police have been on standby in Ulsan to prevent violence, but they did not intervene. As confrontation lasted for almost three hours, HHI issued a sudden notice through loudspeakers and leaflets to change the venue. Showing heir heels, shareholders and company officials aboard buses gathered quickly at an Ulsan University gymnasium some 13.5 kilometers (8.3 miles) away.
HHI and Korea Development Bank (KDB), the largest shareholder of DSME, signed a formal contract on March 8. HHI's labor union has staged a partial walkout since May 16. A full strike began on Tuesday to oppose the division of HHI into Korea Shipbuilding and Marine Engineering, which serves as a control tower for shipbuilding business, and a reorganized shipbuilding entity.
[Yonhap Photo]
KDB chairman Lee Dong-gull has ruled out any massive layoffs, but workers fear redundancies in overlapping business sectors. The two shipyards have already lost more than 30,000 jobs in a government-initiated campaign to restructure South Korea's shipbuilding industry, which has suffered from dwindling orders, a prolonged business slump and a strong challenge from Chinese shipyards.
Policymakers think the integrated shipbuilder can achieve economies of scale, and increase productivity by sharing technology, design, parts and services. With a massive injection of state money estimated at 10 trillion won, DSME has been kept afloat in return for a sweeping rehabilitation program.
reporter
Lim Chang-won
cwlim34@ajunews.com
