South Korea’s Hanwha drops China links as speculation about its Austal interest resurfaces

Austal’s shipyards in Mobile, Alabama. Picture: Tad Denson

Government has returned to Canberra, of sorts, along with the conga line of lobbyists bearing the “hopes” of the business community for the new government.

High among them will be the hope that Treasurer Jim Chalmers finally puts a rocket up the ­Foreign Investment Review Board process.

There’s a long list of items stalled in the FIRB, most recently as decision-making ground to a halt during the election campaign.

Among the trickier decisions facing the returned Treasurer will be what to do about Korea’s ­Hanwha Group and its on-again, off-again pursuit of West Australian shipbuilder Austral.

Hanwha walked away from a $1bn bid for Austal in September, amid much pouting over “unreasonable” demands from the Aussie shipbuilder about break fees and due diligence.

But there’s no doubt the South Korean major is back in the game. This week it ditched a joint venture between one of its subsidiaries and a Chinese shipbuilder, a move seemingly aimed at calming concerns in the US about any ties ­between Western defence contractors and Chinese industry.

Concerns in the US were a key plank of Austal’s rejection of last year’s bid. And in March – only 10 days before Prime Minister Anthony Albanese sent the federal government into caretaker mode – Hanwha launched a new raid on Austal shares, picking up a 10 per cent stake and saying it had a lock on another 10 per cent through a swap arrangement.

At the time Hanwha said it would seek FIRB approval to claim those shares as its own, despite a fresh rebuff from Austal.

But as the end of the financial year approaches, you’d think there’d be a bit of urgency around an FIRB decision. Those shares are still sitting somewhere, and it’s not entirely clear where the voting rights will lie come Austal’s next annual shareholder meeting.

Though it’s probably no coincidence that Jarden, previously doing most of Hanwha’s work, filed a substantial shareholding notice in late April disclosing a “power to control the right to vote attached to securities” worth about 8 per cent of the Austal register, even though no direct relationship to the Hanwha share acquisition was mentioned.

No suggestion of any illegality, or breaches of market rules. But it’s walking a fine line on the rules, and Margin Call would be shocked if Austal hadn’t already picked up the phone to the FIRB asking it to get its skates on and make a recommendation one way or the other. And from there to Treasurer Chalmers’ desk for a final decision.