South Korea's cement industry is undergoing rapid restructuring. With the merger of Hanyi Cement and Hanyi Hyundai Cement, the domestic cement market has gradually formed a "tripartite confrontation" situation. The combined domestic market share of the two companies is about 21.8%, surpassing the previous industry leader Shuanglong Cement (21.2%) and ranking first in the industry. Together with the third place of Panasia Hannah Cement (18.8%), the total market share of the top three is about 62%.
Hanyi Hyundai Cement decided to change its name to Hanyi Cement, which means that the name "Hyundai" will disappear completely in the cement industry since 1958 when Hyundai Construction entered the cement business. After the merger, Hanyi Cement will use the name of "Hanyi Cement" from November 1, and rank first in the domestic market share of Portland Cement. According to the electronic bulletin of the industry and financial supervision Institute, the market share of Hanil Cement was 11.1% last year, and that of Hanil Hyundai Cement was 10.7%, with a combined total sales of about 1.74 trillion won, surpassing Ssangyong C & E, which had sales of 1.7 trillion won last year.
Fanya Halla Cement ranked third with 18.8% market share, of which Halla Cement accounted for 11.7% and Fanya Cement accounted for 7.1%. Although Pan Asia Cement acquired all the shares of Halla Cement in 2018, the two companies will remain independent. In addition to these three giants, Miura Cement (16.2%) and Chengxin Cement (13.5%) are also following closely. In addition, the combined market share of smaller players such as Korea Cement, Allied Cement and Korea C & T is only 8.6%.
Hanyi Modern Cement was renamed in July 2018 after Hanyi Cement and LK Investment Partners jointly set up HLK Holdings to acquire Modern Cement in 2017. Hyundai Cement began as the cement business unit of Hyundai Construction, and with the surge in demand for cement, it established a factory in Danyang, North Chungcheong Province, in 1969, and eventually became an independent cement company. The first representative of Hyundai Cement was Zheng Juyong, the founder of Hyundai Group, and Zheng Shunyong, the second brother and vice chairman of Hyundai Construction, who later became the predecessor of Chengyu Group.
Hanyi Cement said that the final decision of the merger was based on multiple considerations, including improving operational efficiency by reducing duplicate investment and reducing costs, achieving economies of scale by integrating assets and infrastructure and expanding market share, and unifying investment by solving the problem of duplicate listing structure, so as to enhance shareholder value and enterprise value. Quan Genzhi, president of Hanyi Cement, said: "Through this merger, we will reduce the repeated investment and external costs of cement production, maximize operating efficiency and strive to achieve sustainable growth."
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