By Kwanwoo Jun
Shares of Poongsan, a South Korean manufacturer of copper-alloy products and ammunition, rallied on a report that local defense company Hanwha Aerospace is considering acquiring its ammunition business.
Poongsan's shares climbed 12% in early trading on Monday in Seoul, on course to post their sharpest gain in nine months.
Earlier in the day, Hanwha said in a regulatory filing in response to local media reports Friday, that it was reviewing various business opportunities, including a possible acquisition of Poongsan's ammunition unit, to enhance its corporate value and competitiveness in the defense sector.
The South Korean maker of K9 self-propelled howitzers, aircraft engines and other military equipment, however, cautioned that nothing had been decided yet. Hanwha added it would make a further disclosure when more specific details are finalized within a month.
The Korea Economic Daily, citing an unnamed investment banking source, reported Friday that Hanwha had submitted a bid in a private tender to acquire Poongsan's ammunition unit in a deal valued at about 1.5 trillion won, equivalent to $992.6 million.
Poongsan in response to media reports late Friday said it was considering various restructuring measures to enhance corporate value but declined to confirm the reported bid by Hanwha for its ammunition business.
Write to Kwanwoo Jun at kwanwoo.jun@wsj.com
(END) Dow Jones Newswires
04-06-26 0026ET
