Good evening,

Austal chairman John Rothwell is weighing up his future with the ASX-listed shipbuilder as it confronts a trio of potential suitors, Street Talk understands.

Rothwell founded the $887 million Perth-based company in 1988 and has been with it since, steering the ship as its executive chairman until 2008 and non-executive chairman since. Sources said the 80-year-old is considering stepping down, ending 36 years at the helm.

With 9 per cent of Austal in his pocket, Rothwell is a multimillionaire based on his shareholding in the company alone.

It is unclear at what stage Rothwell’s plans are to sell down or cash out. However, it does make it a more attractive proposition for a would-be bidder looking to put its stamp on the company.

Austal knocked back South Korea’s Hanwha’s $1 billion bid on Tuesday, telling investors it had declined to give the defence and aerospace conglomerate access to non-public information for due diligence because it was “not satisfied” that the bid would secure the necessary approvals from defence agencies in Australia and the United States. Hanwha countered saying it’s a “credible buyer” as shares jumped 9.5 per cent to $2.41.

Street Talk first revealed Hanwha’s interest in July with JPMorgan and boutique corporate advisory Poynton Stavrianou working behind the scenes for Austal. But it is far from Austal’s only suitors, which has lucrative contracts with the US Navy but is performing poorly.

This column reported that New York’s JF Lehman & Company, which specialises in investing in complex and regulated sectors, has also been interested in Austal, as has Cerberus Capital Management, a $US60 billion ($88 billion) alternative asset investor. It is understood the pair are still in the data room. However, Hanwha is understood to have taken its leave from the process as its bid would require Foreign Investment Review Board approval.

Austal is a shipbuilder with five shipyards in four countries including the United States, Australia, the Philippines and Vietnam. The prize for suitors is the many US Navy contracts Austal holds. Then there is the large pool of work that will be available as part of the AUKUS defence pact between Australia, the United States and the United Kingdom.

Cerberus is working closely with Citi and Gilbert+Tobin. JFLehman, which specialises in investing in complex and regulated sectors, has engaged Morgan Stanley and Jones Day.

Read the full story tomorrow and more on the Street Talk page.

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