HHIC Phil

Hanjin Heavy Industries and Construction Philippines, commonly known as HHIC Phil, was a Philippine shipbuilding company established in February 2006 by South Korea's Hanjin Heavy Industries and Construction during the group's overseas expansion. Its principal facility was built on the Redondo Peninsula at Subic Bay in Zambales, on land leased from the Subic Bay Metropolitan Authority. The project developed into one of the largest shipyards in the Philippines and was described by the company as one of the world's largest shipbuilding facilities. The company signed its first shipbuilding contract in February 2006, involving four container ships, and began construction of the Subic shipyard in May of that year. Its first completed vessel, the container ship Argolikos, was delivered in July 2008 to Greek shipowner Dioryx. By April 2011, the yard had delivered 20 ships. Its product range included container ships, bulk carriers, crude-oil tankers and gas carriers, as well as offshore structures and components. The yard operated two large dry docks and built vessels in several size classes, including container ships of approximately 3,600, 4,300 and 12,800 TEU, bulk carriers ranging from roughly 135,000 to 205,000 tonnes, and very large crude carriers of about 320,000 tonnes. HHIC Phil expanded beyond standard commercial vessels. In 2013 it completed its first oil tanker, and in 2016 it delivered its first gas carrier. It also manufactured components of catenary anchor-leg mooring buoys associated with the Malampaya offshore gas-field project. The vessel CMA CGM Antoine de Saint Exupery, delivered in 2018, was among the yard's notable container-ship projects. On November 22, 2018, the company delivered two newly completed 114,000-deadweight-ton crude-oil tankers, but it still carried a substantial order book and debt burden. The shipyard became a major source of industrial employment in the Philippines. Its workforce was reported at about 21,000 in 2011 and nearly 20,000 in 2017, after a projected expansion to approximately 28,000 was curtailed by weaker shipbuilding demand. Most employees were Filipino, while management and specialist personnel also included Korean and Romanian workers. The facility used buses, ferries and other company transportation to move employees from nearby communities and operated extensive on-site services. The company also attracted criticism over workplace safety and labor relations. A series of fatal accidents in 2008 prompted investigations by the Subic Bay Metropolitan Authority and the Philippine Congress, which identified alleged violations of safety and labor requirements. Workers and labor organizers later reported further accidents, alleged abusive treatment and dismissals connected with union activity. Safety practices were reported to have improved after 2011, including through the involvement of health and safety personnel representing shipowners. In January 2019, after failing to service loans and obtain further extensions from lenders, HHIC Phil sought corporate restructuring. Its unpaid obligations to five Philippine banks were reported at approximately US$412 million, making the case the largest Philippine bankruptcy or corporate default at that time. The lenders pursued control of the shipyard, while several prospective investors explored acquisitions or restructuring arrangements. The facility ultimately passed into a new operating structure associated with Cerberus Capital Management and Agila Subic. Cerberus completed its acquisition by April 2022, and the site was renamed Agila Subic Multi-Use Facilities. The Philippine Navy began leasing the northern portion in May 2022, while Vectrus also established a presence there. These changes ended HHIC Phil's operation under its original corporate identity.

Hanjin Heavy Industries and Construction Philippines was created in February 2006 as the Philippine subsidiary of South Korea's Hanjin Heavy Industries and Construction. The project formed part of Hanjin's international expansion and centered on a new shipbuilding and repair complex on the Redondo Peninsula at Subic Bay. Construction of the facility began in May 2006 under a long-term lease from the Subic Bay Metropolitan Authority. The location offered access to deep water, large dry docks and the industrial infrastructure of the former Subic naval base. The subsidiary signed its first shipbuilding contract in February 2006 for four container ships. Argolikos, delivered in July 2008 to Greek owner Dioryx, became the first vessel built by the company and was described as the first container ship constructed in the Philippines. Production expanded rapidly, and the shipyard had delivered 20 ships by April 2011. Its main output consisted of container ships and bulk carriers, later supplemented by oil tankers and gas carriers. The company completed its first oil tanker in 2013 and its first gas carrier in 2016. It also undertook offshore fabrication, including parts for CALM buoys used in connection with the Malampaya gas-field project. At its height, the Subic facility was the largest shipyard in the Philippines and one of the country's largest private employers. Employment reached approximately 21,000 in 2011 and remained near 20,000 in 2017, although a downturn in new shipbuilding work prevented the workforce from reaching an anticipated 28,000. The labor force was predominantly Filipino, supported by Korean and Romanian managers, supervisors and technical specialists. The company operated worker transport from nearby towns and communities, as well as large canteens and on-site accommodation for some management personnel. The shipyard's scale also generated safety and labor controversies. Five workers were killed in workplace accidents during two months in 2008, leading to investigations by the Subic Bay Metropolitan Authority and the Philippine Congress. The resulting scrutiny identified alleged shortcomings in workplace safety and labor compliance, and legislators required remedial measures including a medical center and stronger industrial-safety practices. Later worker and organizer accounts alleged abusive management practices, anti-union dismissals and additional fatalities. Church and labor groups publicly supported affected workers. The company stated that management was committed to preventing further incidents, and safety standards were reported to have improved after 2011, partly because shipowners added their own health and safety teams at the yard. Commercial conditions deteriorated as shipbuilding demand weakened and the company remained heavily leveraged. In November 2018, it delivered two 114,000-deadweight-ton crude-oil tankers while approximately 20 vessels were reportedly in various stages of construction. The scale of the unfinished order book did not resolve the company's liquidity problems. On January 8, 2019, HHIC Phil filed for corporate restructuring after defaulting on about US$412 million in obligations to Rizal Commercial Banking Corporation, Land Bank, Metrobank, Bank of the Philippine Islands and Banco de Oro. The case surpassed the Philippine default attributed to Lehman Brothers in 2008 and became the country's largest such case at the time. The lending banks explored taking over the facility, while Chinese firms, Austal and Cerberus Capital Management considered possible acquisitions or partnerships. Austal later abandoned its proposed stake. A subsequent restructuring and debt-transfer process resulted in a Cerberus-affiliated operating structure. Agila Subic assumed operations in March 2022, and the facility was renamed Agila Subic Multi-Use Facilities. Cerberus completed its acquisition by April 2022. The Philippine Navy began leasing the northern section in May 2022, and Vectrus also moved into the complex. The site therefore continued as a strategically important maritime and defense-related industrial facility, but no longer operated under the HHIC Phil identity.

1. 2022Facility transferred to new operating structure

   Agila Subic, affiliated with Cerberus, assumed operations and renamed the site Agila Subic Multi-Use Facilities.

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2. 2019Corporate restructuring filed

   HHIC Phil entered restructuring after defaulting on approximately US$412 million in bank obligations.

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3. 2018Large crude-oil tankers delivered

   The company delivered two 114,000-deadweight-ton crude-oil tankers in November.

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4. 2016First gas carrier delivered

   The shipyard delivered its first gas carrier.

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5. 2013First oil tanker completed

   HHIC Phil expanded its product range by completing its first oil tanker.

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6. 2011Twenty vessels delivered

   The shipyard had delivered 20 ships by April, while its workforce had reached approximately 21,000 employees by September.

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7. 2008First vessel delivered

   The container ship Argolikos was delivered to Greek shipowner Dioryx, becoming the first vessel built by the company.

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8. 2006Philippine subsidiary established

   Hanjin Heavy Industries and Construction established HHIC Phil in February as part of its overseas expansion and signed its first contract for four container ships.

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9. 2006Subic shipyard construction begins

   Construction began on the company's major shipbuilding and repair facility on the Redondo Peninsula at Subic Bay.

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Large-scale export-oriented commercial shipbuilder and ship-repair operator serving international shipowners from a strategically located Subic Bay facility.

• Container shipsCommercial vessels2008

  Container ships were among HHIC Phil's core products, ranging from vessels of approximately 3,600 and 4,300 TEU to large ships of about 12,800 TEU. Argolikos was the first vessel built at the yard, and the facility later delivered major international container ships including CMA CGM Antoine de Saint Exupery.

• Bulk carriersCommercial vessels

  The shipyard constructed bulk carriers in several large size classes, including vessels with stated capacities of approximately 135,000, 175,000 and 205,000 tonnes. These ships formed part of the yard's export-oriented commercial vessel portfolio.

• Oil tankersCommercial vessels2013

  HHIC Phil completed its first oil tanker in 2013 and also built very large crude carriers, including vessels in the approximately 320,000-tonne class. Two 114,000-deadweight-ton crude-oil tankers were delivered in November 2018.

• Gas carriersCommercial vessels2016

  The company expanded into gas-carrier construction and delivered its first gas carrier in 2016.

• Offshore structures and CALM buoy componentsOffshore fabrication

  In addition to ships, the yard undertook offshore construction work and built parts of catenary anchor-leg mooring buoys used in connection with the Malampaya offshore gas-field project.

• Ship repair and dry-dock servicesMaritime services

  The Subic complex included two large dry docks and supported ship-repair and maintenance activity alongside new-vessel construction.

• 2022Transfer and renaming of the Subic facilityM&A

  Following the 2019 restructuring and subsequent negotiations over the shipyard's debt and ownership, the facility moved into a new Cerberus-affiliated structure.

  What changed. Agila Subic assumed operations in March 2022, and the site was renamed Agila Subic Multi-Use Facilities. Cerberus completed its acquisition by April.

  Aftermath. The Philippine Navy leased the northern section in May 2022, and Vectrus also moved into the complex. HHIC Phil ceased operating under its former identity.

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• 2019Corporate restructuring after loan defaultStrategy

  The company faced difficulty servicing high debt and obtaining further extensions from lenders while around 20 vessels remained in various construction stages.

  What changed. HHIC Phil filed for corporate restructuring after defaulting on approximately US$412 million owed to five Philippine banks.

  Aftermath. The banks considered taking over the shipyard, and multiple potential investors examined acquisition or partnership options. The facility later moved into a Cerberus-affiliated ownership and operating structure.

  Unpaid loan obligations. Approximately US$412 million (January 2019)

  • Austal — Austal considered a joint bid with Cerberus but later withdrew its proposed stake.
  • Cerberus Capital Management — Cerberus considered acquiring the Subic shipyard and ultimately completed an acquisition through an affiliated structure.
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• 2012Cooperation with Huntington Ingalls for regional ship servicesStrategy

  Huntington Ingalls Industries announced an arrangement to work with Hanjin at the Subic facility on maintenance, repair and logistics services for United States Navy and other Western Pacific customers.

  What changed. The companies agreed to explore ship maintenance, repair and logistics cooperation at the Subic facility.

  Aftermath. The arrangement opened the possibility of servicing United States military ships at Subic for the first time in almost two decades, although the available material does not establish the scale or duration of resulting work.

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• 2008Workplace deaths and alleged labor-law violationsControversy

  Five workers died in workplace accidents over a two-month period, prompting investigations by the Subic Bay Metropolitan Authority and the Philippine Congress. Authorities identified alleged safety and labor-law violations and required corrective measures. Later workers and organizers also alleged anti-union dismissals, abusive treatment and additional unsafe conditions.

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• 2022Agila Subic assumes operations at the former HHIC facility

  A Cerberus-affiliated Dutch venture, Agila Subic, took over operations and the shipyard was renamed Agila Subic Multi-Use Facilities.

  M&A
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• 2022Philippine Navy leases northern section of former shipyard

  The Philippine Navy began leasing the northern section of the former HHIC facility, while Vectrus also moved into the site.

  Other
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• 2019HHIC Phil files for corporate restructuring over loan default

  The company sought restructuring after defaulting on approximately US$412 million owed to five Philippine banks. The filing became the largest Philippine corporate bankruptcy or default case at that time.

  Bankruptcy
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• 2019Prospective buyers examine the Subic shipyard

  Following the restructuring filing, Chinese companies, Austal and Cerberus Capital Management were reported as potential investors or bidders for the shipyard and its associated debt.

  M&A
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1. Hanjin Heavy Industries and Construction Philippines
2. HHIC Phil official website