Debt-ridden Doosan Group struggles to find its feet
South Korea’s Doosan Group, which owns U.S.-based construction equipment brand Bobcat, is on the selling mode as the debt-ridden business conglomerate struggles to stay afloat.
Doosan even put its 36.27 percent stake in its profitable subsidiary of Doosan Infracore up for sale, by naming Credit Suisse as the lead manager, according to reports Thursday.
The Seoul-based construction machinery manufacturing company racked up about $700 million in profit last year on sales of some $6.8 billion.
Citing unnamed sources in the investment banking industry, however, the reports said that Doosan’s 51-percent stake in Doosan Bobcat was not included in the sales.
When contacted, Doosan refused to confirm the news. “We don’t know what is going on about sales of our affiliates. We are really in the dark,” a Doosan official told UPI News Korea.
Doosan’s flagship company of Doosan Heavy Industries & Construction has languished due to deteriorating financial health _ it has to repay $3.5 billion by the end of 2020.
In particular, the country’s policy shift toward renewable energy negatively affected Doosan, which has competitiveness in thermal and nuclear reactor projects.
To stay alive, Doosan asked for supports of state-run lenders, which earlier this year decided to offer $3 billion of liquidity in loans or other forms. In return, they urged Doosan to raise more than $2.5 billion by disposing of non-core units and property.
Included in the sell-off list are such assets as the group’s head office building, golf clubs, and Doosan Solus. Doosan is even feared to unload its Korea Baseball Organization (KBO) team of Doosan Bears.
UPI News Korea provides this article. _ ED.