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Engineering & Construction

Blocked Hyundai-Daewoo merger leaves shipbuilders at sea

Industry hoped consolidation would bolster prices driven down by competition

Hyundai Heavy Industries and Daewoo Shipbuilding & Marine Engineering hold a combined 60%-plus share of the market for large LNG carriers, according to EU authorities.

SEOUL/TOKYO/DALIAN, China -- Europe's rejection of Hyundai Heavy Industries' acquisition of Daewoo Shipbuilding Marine & Engineering has scuppered what would have been a major step toward consolidation in an industry where excessive competition weighs heavily on profits.

The European Commission on Thursday vetoed the deal between the world's second- and fourth-largest shipbuilders, on the grounds that the South Korean companies' combined market share of at least 60% in large liquefied natural gas carriers would have reduced competition.

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