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Doosan to spin off No. 1 forklift business to Bobcat

By Feb 22, 2021 (Gmt+09:00)

Doosan Bobcat forklift
Doosan Bobcat forklift

South Korea-based power plant builder Doosan Group is planning to spin off its profitable forklift business into construction equipment affiliate Doosan Bobcat in a move to rebuild the group.

According to the M&A industry on Feb. 22, Doosan Group has tapped foreign advisors to discuss Doosan Bobcat's acquisition of the group's forklift operation, Doosan Corporation Industrial Vehicle.

Doosan Bobcat is the group's cash cow, having logged the highest operating profit among affiliates last year. Doosan Group acquired Bobcat from US-based industrial equipment company Ingersoll Rand in 2007 for $4.9 billion. It was the largest overseas acquisition at the time – one that pushed Doosan Group into debt.

Doosan Bobcat's acquisition of the group's forklift business would create synergy in the construction sector. Doosan, which unloaded a controlling stake in its construction equipment maker Doosan Infracore Co. to Hyundai Heavy Industries Holdings Co., would achieve economies of scale in the construction equipment sector via Doosan Bobcat.

Doosan Group's industrial vehicle business group currently holds a 52% market share in the domestic forklift market. It is one of the group's profit-making businesses, reporting around 1 trillion won ($904 million) in annual revenue and over 50 billion won in operating profit, accounting for nearly 4.5% of the group's total revenue.

The industrial vehicle business was part of Daewoo Heavy Industry & Machinery (currently known as Doosan Infracore), which Doosan Group acquired in 2005.

Amid spin-off plans, Doosan Group's creditors have maintained their stance that Doosan Bobcat will remain on the potential asset sale list for the group's restructuring even if it increases its enterprise value by acquiring the forklift division.

Doosan Group has yet to decide if it will unload Doosan Bobcat.

Last year, Doosan Group fetched about 3.6 trillion won in financial support from its creditors, including KDB and Export-Import Bank of Korea. As part of its self-rescue measures, the cash-strapped group pledged to raise 3 trillion won through divestments, paid-in capital increases, and capital expansion.

So far, the group has successfully secured around 3.06 trillion won ($2.8 billion) via active asset sales and rights issues over the past year. The company has offloaded construction equipment maker Doosan Infracore; copper foil materials maker Doosan Solus Co.; hydraulic components manufacturing arm Doosan Corporation Mottrol; venture capital firm Neoplux Co.; skyscraper Doosan Tower; golf course Club Mow CC; and Neoplux.

Write to Ri-ahn Kim at

Danbee lee edited this article.

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