DHIC Faces 4.2 Tril. Won Debt Coming Due This Year
The South Korean government is planning to discuss business recovery measures in relation to Doosan Heavy Industries & Construction on May 29. Korea Development Bank and the Export-Import Bank of Korea will make their decision on a financial support of at least one trillion won after the discussion. It the support is given, the total government assistance for the company will increase to 3.4 trillion won.
The two banks are considering the additional assistance because the company must make large repayments this year. Specifically, it must repay 4.2 trillion won this year and it needs even more money to continue with its business and conduct restructuring.
At present, creditors are about to finalize their due diligence on the company and Doosan Group as a whole and the measures are expected to be completed early next month. Earlier, Doosan Group promised that it would come up with a self-rescue plan of at least three trillion won and dispose of assets. The group is currently preparing to sell 100 percent of its shares in Doosan Solus, which constitute 61 percent of the company supplying electronic and biomaterials.
According to the creditors, Doosan Group cannot repay all of its debts without disposing of lucrative subsidiaries. This means some conflict may arise between the creditors and the group over the disposal of a key subsidiary such as Doosan Infracore and Doosan Bobcat.