Hanwha Aerospace Acquiring Additional 7.3% Stake in Hanwha Ocean for About 1.3 Trillion Won

Hanwha Aerospace announced a rights offering capital raise of 3.6 trillion won; this is the largest ever rights offering in Korea. This is likely to have a negative impact on Hanwha Aerospace and the entire Korean defense sector. The new share allocation date is April 24. Expected rights offering price is 605,000 won (16.2% below current price). We are concerned about share dilution overhang.