Thursday, September 4, 2008

Bad News For Daewoo Is Good News For Transocean

Bad news for Daewoo is good news for Transocean and Daewoo suitors including POSCO: Daewoo Ship Shows Subprime Woes Overcome Drill Orders.

Sept. 4 (Bloomberg) -- Park Chang Suk isn't waiting to learn what Daewoo Shipbuilding & Marine Engineering Co. will be worth when the South Korean government sells the maker of oil tankers, submarines and ferries this fall.

The 35-year-old Park, who oversees the equivalent of $481 million at NH-CA Asset Management Co. in Seoul, dumped his shares as orders fell by one-third from January to June and the Seoul- based company canceled a container-ship contract for the first time in its 35-year history.

State-run Korea Development Bank and Korea Asset Management Corp. plan to sell their 50.4 percent interest in the world's third-biggest shipbuilder for as much as 7 trillion won ($6.1 billion), according to Cho In Karp at Good Morning Shinhan Securities Co. in Seoul. Steelmaker Posco and Hyundai Heavy Industries Co. last week joined two other companies in making separate offers. The bidding has failed to stir the shares, now at their lowest in five months.

``The shares could move higher on the sale, but for me that's not enough to change my position on Daewoo Shipbuilding,'' said Park, who earned a Master of Business Administration degree from the University of Washington. ``The shipbuilding industry has already reached its peak. Demand has weakened. And Daewoo Shipbuilding is just too expensive.''
2 months ago things were a lot different: Daewoo Ship Receives Record 2.44 Trillion Won Order.

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