Daewoo cancels $820m deal
Korean behemoth’s marine division pulls the plug over unnamed company’s failure to comply with contract terms.
The Korean Herald reports today that Daewoo Shipbuilding & Marine Engineering (DSME), has pulled out of a deal worth 891 billion Korean won or $820 million. The company cites failure to comply with contractual obligations as the reason. The unidentified African company signed the deal with DSME last December but has not implemented the necessary conditions for the deal to take effect.
Daewoo said the cancellation has not caused financial loss, as it had not yet started construction of the vessels the company had ordered. Markets reacted with a rise in DSME shares of 1.67 per cent, to close at 27,400 won on the Seoul stock exchange.
The cancellation is reported in the wake of a major deal won by the yard from Hapag-Lloyd and so far this year DSME has been able to meet 75 per cent of its order targets.
