The Export-Import Bank of Korea is moving to hire global consulting firm AT Kearney to study ways to strengthen the country's space and aviation industry. The bank wants to assess the competitiveness of major domestic companies and draw up plans to nurture the sector. The move has also drawn attention to the possibility that the bank, the largest shareholder in Korea Aerospace Industries, could sell its stake.
Korea Eximbank has selected AT Kearney as the preferred bidder for the consulting project and is in negotiations, according to financial industry sources on the 26th. The project, tendered in August, carries a budget of 1.8 billion won ($1.3 million). The work is to be completed within three months of the contract date. The request for proposals calls for individual analysis of major domestic space and aviation companies and plans to develop a global anchor company. The study will also review a phased timeline, required funding and financing options for carrying out those plans.
Industry watchers are focusing on whether the findings could feed into discussions on restructuring the space and aviation sector. One scenario under discussion is privatization, in which the bank would dispose of its KAI shares and Hanwha Group would buy them.
Korea Eximbank held a 26.41% stake in KAI as of the 23rd, making it the largest shareholder. Hanwha Group raised its holding to 15.89% in August, when the tender notice was posted, becoming the second-largest shareholder. By affiliate, Hanwha Aerospace holds 9.90%, Hanwha Systems 4.98% and Hanwha Aerospace USA 1.01%.
Hanwha has also added strategy personnel to lead the business. Kim Sun, head of Hanwha Aerospace's aviation business division, joined last year as head of the space team at the group's strategy office after working at AT Kearney, Boston Consulting Group and STIC Investments. Kim currently also serves as head of space business at both Hanwha Aerospace and Hanwha Systems.
If Hanwha gains the capability to develop and produce complete aircraft through KAI, it could further strengthen links across its army, navy, air force and space businesses. Korea Eximbank, however, said it has no plan to sell at this point and that the date for signing the contract with AT Kearney has not been set.