Hanwha's KAI bid bodes well for another defense leap forward
Hanwha Group’s potential acquisition of Korea Aerospace Industries (KAI) could give the country’s aerospace and defense industry a much-needed boost in the global market, as privately owned defense firms have significantly outpaced their state-backed rival in sales growth. Yet transferring control of a strategically important company to a private conglomerate would also raise questions over…
The acquisition of Korea Aerospace Industries (KAI) by Hanwha Group could provide a significant boost to South Korea's aerospace and defense industry in the global market. Privately owned defense firms have been outperforming their state-backed counterparts in terms of sales growth. However, the transfer of control of a strategically important company to a private conglomerate raises concerns over national security, market concentration, and the public investment that has contributed to KAI's technological achievements.
Since its establishment in 1999, KAI has been under state ownership, with the Export-Import Bank of Korea as its largest shareholder, holding a 26.41% stake. Hanwha, the second-largest shareholder, holds a 15.89% stake. KAI's growth has been slower compared to private-sector defense firms. In 2025, KAI's annual sales reached 3.69 trillion won ($2.79 billion), down from 3.81 trillion won in 2023.
In contrast, LIG Defense & Aerospace, a private defense firm, has seen faster growth during the same period.
Written by urgent.news from The Korea Times's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
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