Doosan Enters '3 Trillion Won Self-Rescue Plan'... First Asset Sale 'Doota'

Real Estate Investment Management Firm Nears Contract Worth 700 Billion to 750 Billion KRW
Doosan Solus Shifts to Public Sale
Additional Workforce Restructuring Concurrently... Second Voluntary Retirement Applications Open Until the 15th

On the 27th, the Doosan Tower building in Dongdaemun-gu, Seoul, is visible as the government decided to inject 1.6 trillion won into Doosan Heavy Industries, which is experiencing financial difficulties, through the Korea Development Bank and the Export-Import Bank of Korea. Photo by Kang Jin-hyung aymsdream@

[Asia Economy Reporter Ki-min Lee] Doosan Group's plan to prepare a self-rescue plan worth 3 trillion won is being actively promoted. Starting with negotiations to sell Doosan Tower, the heart of the group, the pace is accelerating for the sale of affiliates such as Doosan Solus and workforce restructuring.

According to the investment and business circles on the 12th, Doosan is proceeding with the sale of buildings including Doosan affiliates and workforce restructuring simultaneously to secure 3 trillion won in liquid assets.

First, Doosan is conducting final negotiation procedures to sell Doosan Tower in Dongdaemun-gu, Seoul, to Maston Investment Management, a real estate-related management company. Doosan Tower has been used as Doosan's headquarters for over 20 years since its completion in 1998. It is a building with 7 basement floors and 34 above-ground floors, with a total floor area of 122,630.26㎡. The sale price is reportedly being adjusted around 700 billion to 750 billion won. This is similar to the book value of Doosan Tower at 681.1 billion won when Doosan merged Dutamall in 2018. Considering the 400 billion won corporate bonds, collateral funds, and transaction costs that Doosan previously secured by using the Doosan Tower site and building as collateral, the amount Doosan can secure from the sale of Doosan Tower is expected to be about 100 billion won.

In addition, for Doosan Solus, which operates in the battery foil (copper foil) and OLED business, Doosan is switching to an open sale and is promoting a plan to sell it to a large company engaged in the secondary battery business. Doosan and Chairman Park Jung-won hold 61% of Doosan Solus shares. Doosan estimates the value of the shares, including management rights, at about 800 billion won. However, due to the ongoing impact of COVID-19, large companies are hesitant to enter the bidding for Doosan Solus due to concerns about prolonged recession and deteriorating performance. Therefore, Doosan is reportedly considering separating and selling only the Hungarian battery foil factory of Doosan Solus. Doosan Solus plans to complete the Hungarian factory this year and produce 10,000 tons of battery foil annually. Since the Doosan Solus Hungarian factory is the first domestic battery foil production line to enter Europe, Doosan sees sufficient investment value. According to industry sources, Doosan is demanding around 300 billion won as a paid-in capital increase for the expansion of the Hungarian battery foil factory. Other divisions under consideration for sale include Motrol, Industrial Vehicles, and Electronics, which are business units of Doosan Co., Ltd.

There are rumors that Doosan might sell Doosan Infracore and Doosan Bobcat. However, since selling Infracore and Bobcat could cause a sharp decline in Doosan's performance and lead to another liquidity crisis, the feasibility is considered low.

Workforce restructuring has also begun in earnest. Doosan Heavy Industries is accepting second-round voluntary retirement applications until the 15th for about 2,000 office and technical employees aged 45 (born in 1975) or older. In the first round of voluntary retirement conducted in February and March this year, about 650 workers applied. However, Doosan Heavy Industries estimates that 1,200 to 1,500 employees must retire to save about 150 to 200 billion won through workforce restructuring. There is also internal speculation that Doosan Heavy Industries may start temporary layoffs for some idle personnel from the 21st. Amid this, labor-management conflicts over workforce reduction are expected to intensify, as the self-rescue plan was prepared under creditor pressure without sufficient consultation with the labor union.

Meanwhile, Doosan's final self-rescue plan is expected to be announced after the board meeting on the 14th.

This content was produced with the assistance of AI translation services.