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Doosan likely to finalize self-rescue package next month

All News 11:01 May 27, 2020

SEOUL, May 27 (Yonhap) -- South Korea's cash-strapped Doosan Group is likely to finalize its self-rescue plan next month, as creditors have yet to vet the books of the group's affiliates, industry sources said Wednesday.

The country's 15th-largest conglomerate last month submitted to creditors, including the Korea Development Bank (KDB) and the Export-Import Bank of Korea (Eximbank), a plan to sell shares and non-core assets in a bid to secure more than 3 trillion won (US$2.4 billion) in liquidity.

Its creditors funneled 2.4 trillion won into the group to help it overcome a credit crunch sparked by worsening performance at its key affiliate, Doosan Heavy Industries & Construction Co.

Samil PricewaterhouseCoopers, a South Korean accounting firm, had originally planned to complete due diligence of the group affiliates' accounting books this month, but failed to do so, according to the sources.

This file photo shows Doosan Tower, Doosan Group's building in Seoul.(Yonhap)

This file photo shows Doosan Tower, Doosan Group's building in Seoul.(Yonhap)

The group has put its affiliates and assets, such as Doosan Solus Co., a South Korean copper foil maker for electric vehicles, and Doosan Tower, the group's headquarters building in Seoul for sale, but the deal has not been finalized.

The sale of Doosan Solus is expected to fetch between 700 billion won and 800 billion won, but Doosan Group wants at least 1 trillion won from the asset sale.

It has been widely said that Doosan Heavy suffered setbacks in business as the outbreak of the new coronavirus and the poor performance of its construction affiliate, Doosan Engineering & Construction Co., dented Doosan Heavy.

Another reason for the setback has been reported to be the shift of the country's energy policy from nuclear and fossil fuel-based power generation to renewable energy sources, such as solar power.

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