HD Hyundai's intermediate holding company, HD Korea Shipping and Offshore Engineering, merged two of its subsidiaries to enhance competitiveness ahead of the "Make American Shipbuilding Great Again"(MASGA) shipbuilding cooperation between South Korea and the U.S.

The intermediate holding company and its two subsidiaries - HD Hyundai Heavy Industries and HD Hyundai Mipo - each convened a meeting of board of directors on Wednesday, to approve the merger.

The two subsidiaries are expected to hold an extraordinary meeting of shareholders and an integration review, before the merged entity launches in December.

The intermediate holding firm said the reshuffle is a strategic move to maximize synergy and to obtain competitive advantage in the global market through proactive development of cutting-edge technologies.

The merger will likely facilitate improvement of the integrated entity's competitiveness in the defense industry, which targets annual sales of ten trillion won, or around seven-point-two billion U.S. dollars, by 2035.