EU approves Saudi Aramco and Hyundai Heavy joint venture
- Business & Finance
The European Commission has approved the creation of a joint venture between subsidiaries of oil giant Saudi Aramco and South Korean rig and shipbuilder Hyundai Heavy Industries.
The European Commission said that the merger was approved under the EU Merger Regulation and that the two companies in question were the Saudi Aramco Development Company (SADCO) and HHI’s Korea Shipbuilding and Offshore Engineering Company (KSOE).
According to the Commission, the joint venture will construct and operate a manufacturing site of engines and marine pumps in Saudi Arabia.
SADCO is active in the exploration, production and marketing of crude oil, and the production and marketing of refined products and petrochemicals while KSOE provides integrated systems and solutions for powering seaborne transportation and technology and services for the offshore industry.
The Commission concluded that the proposed acquisition would raise no competition concerns because the joint venture would not be active in the European Economic Area.
It is worth noting that the transaction was examined under the simplified merger review procedure.
To remind, Saudi Aramco signed twelve agreements potentially worth billions of dollars with Korean companies in June 2019.
Several of those were with Hyundai Heavy Industries, which included the establishment of engine making facility JV in Saudi Arabia, collaboration in the space of shipbuilding, engine manufacturing, refining, and petrochemicals.
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