European Union to block South Korean shipbuilding mega-merger
Categories: FOREIGN COUNTRIES
Antitrust authority of the European Union will block shipbuilding merger of South Korean companies Daewoo and Hyundai due to concerns that the deal may restrict supply of cargo vessels. The possibility of the veto was reported by AFP citing sources. The veto of the tie-up comes two years after Brussels stopped India's Tata Steel and Germany's Thyssenkrupp from merging, and three years after it blocked the merger of the train businesses of Siemens and Alstom, angering France and Germany. Of particular concern is the deal's fallout on the construction of ships transporting liquefied natural gas, especially at a time when high energy prices are an acute concern in Europe.But the price of cargo shipping more generally has exploded in recent months due to the shock to the global chain caused by the coronavirus pandemic. The commission and the two companies "have explored all possible remedies to the competition concerns raised in considerable detail", without success, said a second source for whom the rejection of the operation is "beyond doubt".The deadline for the decision was set for January 20, after several extensions.