Cerberus, HD Hyundai to kickstart Subic operations in 12-18 months

MANILA, Philippines —  South Korean shipbuilder HD Hyundai is expected to start manufacturing operations in Subic Bay within the next 12 to 18 months, with an initial focus on offshore wind platforms.

In a briefing yesterday, Alexander Benard, Cerberus Capital Management senior managing director and co-head of Cerberus Frontier, said the firm has entered into a multi-year agreement with HD Hyundai Korea Shipbuilding and Offshore Engineering (KSOE), which will lease a section of the shipyard at the Subic Bay Freeport Zone.

He declined to provide details on the value of the lease agreement and the number of years it would cover.

“We anticipate that within 12 to 18 months, the site will be ready and that’s when the actual manufacturing activities will begin,” he said.

He said HD Hyundai KSOE, which is expected to bring maritime manufacturing back to Subic, would initially start with offshore wind platforms.

“It is a similar type of advanced maritime manufacturing, but the product is slightly different,” he said.

Cerberus acquired in 2022 the shipyard previously occupied by Hanjin Heavy Industries and Construction Philippines Inc.   after the latter went bankrupt in 2019.

The asset has been rebranded into Agila Subic.

The Presidential Communications Office said HD Hyundai is projecting to invest approximately $550 million over 10 years and generate around 10,000 jobs within three to five years.

HD Hyundai KSOE plans to build a state-of-the-art maritime complex capable of handling offshore wind structures, ship block fabrication, ship repairs and other services.

“This initiative represents a major opportunity to create jobs and reinvigorate the local economy, which will help to further establish the Philippines as a global maritime powerhouse,” HD Hyundai KSOE CEO Sungjoon Kim said.

Aside from HD Hyundai KSOE, other tenants of the facility include leading global subsea cable company Subcom, logistics company V2X and the Philippine Navy, which occupies 100 hectares in the northern portion of the site.

Benard said Cerberus is in talks with firms for the remaining unoccupied section of the shipyard.