By Kim Yoo-chul
Staff Reporter

Doosan Heavy Industries & Construction has agreed with Skoda Power to buy all shares in the Czech turbines maker.

The $655-million deal is the latest in a series of takeovers by the group, which has already purchased Bobcat of the United States in 2007.

Doosan's purchase of the 150-year-old turbine maker, which sells products in over 60 countries, would also help complement the company's power generation and engineering business, as it has resorted to foreign rivals such as GE to secure turbine technologies.

Doosan Heavy, led by CEO Park Gee-won, is South Korea's biggest power equipment maker and also produces industrial facilities, machine tools and construction equipment.

"Skoda Power and Doosan Babcock will spearhead our progressive expansion project in Europe, the United States and other developed markets," group spokesman, Shin Dong-gyu, said.

``The deal will also enable Skoda and Doosan to significantly expand business opportunities in new markets,'' the official said.

The series of M&A moves, however, is raising worries over Doosan's financial soundness.

``The deal will cause Doosan Heavy to secure key technologies in steamed turbine engine businesses. The selection and concentration of the M&A strategy will be helpful to the group in the long-term,'' Lee Ji-hoon, an analyst at SK Securities, said.

The local brokerage presented a "buy" rating on Doosan Heavy and maintained 82,000 won as its target price, up from 67,100 won as of Tuesday.

"The recent deal is a good one for the group. But Doosan will suffer a short-term financial burden as it is required to raise additional capital for the completion of the deal," Kang Young-il, an analyst at HMC Investment, said.

yckim@koreatimes.co.kr