Hanwha Dives into $2 Billion Polish Submarine Project with WB Group Partnership
Hanwha Ocean Co. has signed an initial agreement on business cooperation with Polish defense company WB Group to raise its chances of winning the $2.2 billion next-generation submarine project, ORKA, in the European country.
The shipbuilding unit of South Korea’s chemicals-for-defense conglomerate Hanwha Group signed a memorandum of understanding (MOU) on business cooperation in Kielce, Poland.
The MoU was signed on the sidelines of MSPO 2024, an international defense industry exhibition held in the heart of the Polish city.
The ORKA project, worth about 3 trillion won ($2.2 billion), is a new submarine construction project for the modernization of the Polish Navy, which includes the acquisition of three submarines.
Founded in 1997, WB Group is one of Europe’s largest defense contractors, producing military communications equipment, reconnaissance systems and weapons control systems.
Hanwha Ocean, a leading container ship builder and the only Korean company that has built submarines for the Korean Navy since 1987, is one of the world’s top shipbuilding companies.
Under the MoU, Hanwha and WB plan to leverage their technologies and networks to win the ORKA project.
During the MoU signing event, Hanwha explained about its plans to localize its submarine maintenance, repair and overhaul (MRO) business.
If Hanwha wins the Polish contract, Kolon Spaceworks Co, a Korean equipment supplier, will likely handle the supply of MRO materials.
Technology Transfer and Localization
In May, Hanwha Ocean held an investor forum in Gdansk, where it announced plans to transfer its subsea equipment and parts technology and collaborate with Polish partners.
In the same month, Hanwha said it had teamed up with Polish state defense group Polska Grupa Zbrojeniowa SA (PGZ) to win the ORKA project.
In June, the Korean shipbuilder, along with Polish state defense company PGZ and British defense company Babcock International Group plc, submitted a joint MRO business plan to Poland’s arms agency.
Hanwha aims to sell the Jang Bogo-III Batch-II class, or KSS III diesel-electric submarine, to Poland which currently operates one submarine of Russian origin from the 1980s.
Hanwha Ocean plans to team up with major South Korean contractors to sell the Jang Bogo-III, which is manufactured with 80% Korean technology and components.
“The Memorandum of Understanding with WB Group is part of our efforts to strengthen partnerships with local companies. We expect WB Group to be a strong ally for Hanwha in winning the ORKA project,” said Hanwha Ocean Vice President Jung Seung-kyun.
The Hanwha Group has already collected billions of dollars in defense contracts with Poland. In April, Hanwha Aerospace Co. signed a $1.64 billion deal to supply 72 units of the Chunmoo multiple launch rocket system (MLRS) to Poland.