이 기사는 2021년 08월 13일 07:57 thebell 에 표출된 기사입니다.

Hanwha Energy, the energy arm of South Korea’s Hanwha Group, is set to merge with its parent company H-Solution, a move likely to help drive the conglomerate’s succession planning.

The boards of directors of Hanwha Energy and H-Solution approved H Solution’s merger into Hanwha Energy on Wednesday, according to regulatory filings. The transaction is expected to be completed before October.

“The merger aims to streamline the decision-making process and enhance management efficiency and transparency,” said Hanwha Group. “It is also expected that the merger will help improve the financial position of Hanwha Energy by increasing total assets and reducing the debt ratio.”

H-Solution owns 100% of Hanwha Energy and the merger will thus not entail the issue of new shares in the merged entity. If the transaction is completed, three existing shareholders of H-Solution – Kim Dong-kwan, Kim Dong-won and Kim Dong-seon, who are the three sons of Hanwha Group chairman Kim Seung-youn – will own 50%, 25% and 25% stakes in Hanwha Energy, respectively.

H-Solution will cease to exist after the merger. This will simplify the ownership structure at the group level, with Hanwha Energy at the top of the ownership chain which involves Hanwha General Chemical and Hanwha Total Petrochemical.

Hanwha Energy provides integrated energy services primarily in industrial complexes in Jeolla Province and also engages in solar power generation business at home and abroad. The company had total assets of about 5.1 trillion won ($4.4 billion) at the end of March this year on a consolidated basis.

The merger will also likely help drive the conglomerate’s succession planning as Kim Dong-kwan – president of Hanwha Solutions and the eldest son of the group’s chairman – seeks to secure financial resources to buy shares in Hanwha Corp, the conglomerate’s de facto holding company. Possible scenarios include selling his shares in Hanwha Energy in a potential public offering or raising money through a minority stake sale to another Hanwha affiliate.

H-Solution holds a 5.19% stake in Hanwha Corp and a 13.41% stake in and Hanwha Systems, which will be owned by Hanwha Energy after the merger. (Reporting by Ki-soo Park)