Wed, Jan 11, 2012 - Page 10 News List

South Korean shipbuilders considering joint bid for French group GTT: officials

AFP, SEOUL

South Korean shipbuilders trying to stay ahead of archrival China are considering a joint bid for a French group that provides advanced technology for liquefied natural gas (LNG) sea transport, officials said yesterday.

Gaztransport & Technigaz (GTT) specializes in cargo containment systems for advanced LNG carriers. Delegates from its financial advisers, Lazard, had paid a two-day visit to South Korea to brief potential buyers and would also meet Chinese shipbuilders, the officials said.

“South Korean shipbuilders are interested in the bidding,” an official at Hyundai Heavy Industries (HHI), the world’s largest shipbuilder by sales, said on condition of anonymity.

The shipyards, including HHI, Daewoo Shipbuilding & Marine Engineering (DSME) and STX Offshore & Shipbuilding, may form a consortium to make a 1 billion euro (US$1.3 billion) bid for the French group, he said.

It would be difficult for a South Korean shipyard to make a solo bid at a time when the global shipbuilding industry is in a downturn, he added.

A DSME official said local shipbuilders were worried that if Chinese competitors buy GTT, they would close the technology gap with South Korean firms and force them to pay royalties.

South Korean shipbuilders pay GTT US$10 million for each LNG vessel, about 5 percent of the total building cost, because GTT has a patent for its LNG containment systems.

Last year South Korea received orders for 40 LNG carriers, about 70 percent of total global orders. It was also the world’s largest builder of all types of ship, London-based Clarkson Research Services said.

The firm said South Korean shipbuilders won a combined 13.55 million compensated gross tons (CGTs) in new orders last year, while Chinese shipbuilders clinched a total of 9.2 million CGTs.

It said South Korea accounted for 48.2 percent of the total 28.11 million CGTs worth of deals placed globally, compared with 31.2 percent a year earlier.

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