Doosan Ignites 'Financial Structure Improvement'... 'Solus Sale, Capital Increase, Private Fund Contribution' (Comprehensive)

Doosan Solus Sold to Skylake for 698.9 Billion KRW... Motrol Business Unit Sold to Socious-Welltoshi Consortium for 453 Billion KRW
Doosan Heavy Industries to Raise 1.3 Trillion KRW through Paid-in Capital Increase
Doosan Co. Major Shareholder Donates 23% Stake in Doosan Fuel Cell to Doosan Heavy Industries for "Responsible Management Personal Contribution"

[Image source=Yonhap News]

[Asia Economy Reporter Ki-min Lee] Doosan Group's financial restructuring to normalize the management of Doosan Heavy Industries & Construction is progressing rapidly.

On the 4th, Doosan Group announced a plan to increase capital for Doosan Heavy Industries & Construction through equity investment. First, Doosan Heavy Industries & Construction decided to conduct a paid-in capital increase worth 1.3 trillion KRW. The paid-in capital increase will be carried out through a rights offering followed by a public subscription, and if there are any unsubscribed shares, the underwriting securities company will take them up. Doosan Heavy Industries & Construction plans to use the funds raised from the capital increase to repay borrowings and other purposes.

Earlier, in early last month, Doosan Heavy Industries & Construction sold the golf course Club Mow CC to the Hana Financial-Moa Miraedo consortium for 185 billion KRW and made its first repayment of borrowings to creditors. The repayment amount is reported to be about 120 billion KRW. Additionally, venture capital firm Neoplux signed a contract to sell to Shinhan Financial Group for approximately 73 billion KRW (tentative).

Doosan Co., Ltd. sold Doosan Solus, a battery sheet manufacturer, and the Motrol business division to participate in the paid-in capital increase. Doosan Co., Ltd. and special related parties including Doosan Group Chairman Park Jung-won sold Doosan Solus to the private equity firm Skylake Investment, with whom negotiations had been ongoing since the first half of this year, for 698.6 billion KRW. The Motrol business division was also spun off and is scheduled to be sold to the Socious-Welltouch consortium for 453 billion KRW.

In particular, the major shareholder of Doosan Co., Ltd. decided to donate 23% of Doosan Fuel Cell shares, worth 574 billion KRW, to Doosan Heavy Industries & Construction free of charge. Doosan stated that this was a personal contribution for responsible management.

Earlier this year, to resolve the management crisis of Doosan Heavy Industries & Construction, the creditor group urgently injected 3.6 trillion KRW, and a self-rescue plan focusing on securing liquidity of over 3 trillion KRW was prepared. Chairman Park Jung-won sent a message to all group employees on June 11, stating, "Doosan Heavy Industries & Construction plans to improve its financial structure by more than 3 trillion KRW, including a paid-in capital increase and capital expansion of about 1 trillion KRW within this year."

Doosan Group has been striving hard by selling assets and reducing fixed costs. The sale of Doosan Tower is in its final stages. Doosan Infracore, known as Doosan Group's cash cow, recently sent teaser letters to potential buyers and will soon receive preliminary bids. Doosan Heavy Industries & Construction conducted two rounds of voluntary retirement this year to reduce fixed costs such as labor costs, and currently about 350 employees are on leave. Executives of all Doosan Group affiliates have returned 30% of their salaries since April. Executives of Doosan Heavy Industries & Construction return up to 50%.

Doosan Heavy Industries & Construction plans to restructure its business to become an eco-friendly energy specialist company focusing on gas turbines, renewable energy, next-generation small and medium-sized reactors (such as U.S. small modular reactors), hydrogen, and fuel cell businesses.

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