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Posted by Allen Newton
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6 January, 2026
WEST Australian shipbuilder Austal had every reason to celebrate this festive season with new defence contracts worth billions of dollars, along with the finalisation of the long-running bid by South Korea’s Hanwha to buy into the company.
Austal announced that it has been awarded a $1.029 billion design and build contract for Landing Craft Medium (LCM) under the Strategic Shipbuilding Agreement (SSA) signed with the Commonwealth of Australia.
The contract appoints Austal subsidiary, Austal Defence Shipbuilding Australia Pty Ltd (Austal Defence Australia), to complete the detailed design and build of 18 Landing Craft Medium (LCM) vessels at Austal’s Henderson, Western Australia, shipyard.
Construction of the first LCM is scheduled to start in 2026 with the 18th and final vessel scheduled for delivery in 2032.
The LCM, being built for the Australian Army, will be manufactured in steel and capable of tackling loads up to 80 tonnes.
Austal Limited CEO Paddy Gregg said the first design and build contract awarded under the SSA was a significant milestone for Austal Defence Australia, as the Commonwealth’s Strategic Shipbuilder in Western Australia.
“This Landing Craft Medium design and build contract awarded to Austal Defence Australia is the first vessel construction program in the government’s commitment to delivering continuous naval shipbuilding at Henderson, Western Australia, enlivening decades of opportunity for individuals and businesses to engage, collaborate and invest in defence programs,” Mr Gregg said.
“With these 18 Landing Craft Medium and any further vessels planned as part of the Strategic Shipbuilding pilot program, we are developing the shipbuilding capability to build larger, more complex vessels, in Henderson into the future and delivering sovereign shipbuilding capability for Australia."
Austal’s Christmas celebrations continued with the award of a further contract extension for the construction of two additional Evolved Cape-class Patrol Boats for the Australian Border Force (ABF).
This latest award, valued at more than $135 million brings the total number of Evolved Cape-class Patrol Boats contracted to Austal to 14 vessels, reinforcing the long-standing partnership between Austal, the Australian Border Force and the Royal Australian Navy in delivering critical maritime capability for Australia’s national security.
Mr Gregg said the additional vessels continue to strengthen Maritime Border Command’s readiness and operational reach.
“Over the past five years, the Evolved Cape-class Patrol Boats have proven themselves as highly capable, reliable assets for Australia’s border protection missions,” Mr Gregg said.
“With nine Evolved Capes already delivered and performing exceptionally with the Royal Australian Navy, and two more already under construction for the Australian Border Force, this new order further enhances Australia’s maritime surveillance and response capability across Northern Australia and our vast maritime domain.”
Austal’s final Christmas gift came in the form of a conclusion to a drawn-out battle by South Korean shipbuilder Hanwha to take over Austal which came to a close on 12 December when the two companies signed a government‑approved, tightly regulated strategic investment relationship, with Hanwha holding 19.9% and positioned as Austal’s largest shareholder — but without control.
The Australian government approved the increase with strict conditions, including limits on Hanwha’s access to Austal’s sensitive defence information; restrictions to ensure Austal remains an Australian sovereign shipbuilder; and a hard cap at 19.9%, preventing a creeping takeover.
Hanwha had previously attempted a full takeover, which had been rejected.
