SEOUL, July 8 (Yonhap) — Doosan Corp., the parent of South Korea’s 15th-largest conglomerate Doosan Group, said Wednesday that it has signed a preliminary deal with private equity fund SkyLake Investment Co. to sell its stake in its affiliate Doosan Solus Co.
Doosan, however, did not reveal its sales conditions and prices for the stake in the battery copper foil maker.
Doosan Corp. holds a 17 percent stake in Doosan Solus, with key stockholders, including Doosan Group chairman Park Jung-won, having a combined 44 percent stake in the battery copper foil maker.
As of Wednesday, the market capitalization of Doosan Solus is estimated at some 1.02 trillion won (US$900 million) on the Seoul bourse.
Doosan Group had been in negotiations with the private equity fund to sell Doosan Solus.
Cash-squeezed Doosan Group has been pushing ahead with its plan to sell its assets to improve its financial health.
Included in the asset sales list were also power plant builder Doosan Infracore Co., venture capital firm Neoplux Co., the group’s headquarter building Doosan Tower, a golf course, Doosan Engineering & Construction Co. and oil pressure machine maker Doosan Mottrol, a business division of Doosan.
A group led by Hana Financial Investment Co. has been singled out as the preferred bidder for the golf course.
The group’s credit crunch was caused by a lack of orders at its power plant affiliate Doosan Heavy Industries & Construction Co. and extended losses at its construction unit Doosan Engineering & Construction.
State-run banks — Korea Development Bank and the Export-Import Bank of Korea — injected a total of 3.6 trillion won into the group to keep it afloat between March and June, as the group drew up a 3 trillion-won self-rescue plan.
As part of its efforts to overcome its cash shortages, the group has decided to focus on its clean energy-related business by selling off other affiliates and assets in return for financial support by its creditors.
As of the end of 2019, Doosan Group has 25 affiliates, including Doosan and power plant builder Doosan Heavy Industries & Construction Co., under its wing.