Doosan Robotics-Bobcat merger to go ahead under revised plan

Doosan Group will revise the merger ratio between Doosan Bobcat and Doosan Robotics after investor pushback.

Doosan Enerbilty Chief Financial Officer Park Sang-hyun, center, speaks during a press conference in central Seoul on Monday, with Doosan Robotics CEO Ryu Jung-hoon, left, and Doosan Bobcat CEO and Vice Chairman Scott Park. [YONHAP]

Doosan Group will go ahead with its merger of subsidiaries Doosan Bobcat and Doosan Robotics — with a revised merger ratio, in hopes of quelling the investor outcry that ground its original proposal to a halt in August.

Under an updated plan announced on Monday, the merger ratio between Doosan Robotics and the new spinoff from Doosan Enerbility has been revised from its previous 1:0.031 to 1:0.043. Doosan Bobcat will become a subsidiary of Doosan Robotics under the revised protocol, but not a wholly-owned one.

The initial plan, announced on July 11, involved spinning off a new entity from Doosan Enerbility, currently Doosan Bobcat's largest shareholder with a 46 percent stake. Doosan Bobcat, a construction equipment manufacturer, was to be incorporated into the spinoff and delisted from the stock market. The resulting entity would become a wholly owned subsidiary of Doosan Robotics, a much smaller robot developer, at a swap ratio of 1 to 0.63 — valuing every share of Doosan Robotics at 63 percent of a Doosan Bobcat share.

The conglomerate abandoned the plan in August after shareholders and financial authorities claimed that it undervalued the value of cash cow Doosan Bobcat, which reported an operating profit of $1 billion in 2023, relative to Doosan Robotics, which logged an operating loss of $13.87 million.

Under the revised plan, a Doosan Enerbility shareholder with 100 shares of the company will hold 88.5 shares of Doosan Enerbility and 4.33 shares of Doosan Robotics after the shake-up. Before the revision, 100 shares of Doosan Enerbility would have translated to 75.3 shares of the company and 3.15 shares of Doosan Robotics.

“The merger ratio has been revised in order to provide the largest number of shares possible,” said Doosan Enerbility Chief Finance Officer Park Sang-hyun during a news conference in central Seoul on Monday.

Park apologized for “causing confusion and concerns due to insufficient communication,” but said that the corporate shake-up would drive growth for both Doosan Enerbility and Doosan Robotics.

BY SHIN HA-NEE [shin.hanee@joongang.co.kr]