Doosan finds optimized lineup for growth
By Kim Yoo-chul
Doosan Group, the oldest chaebol, or family-owned conglomerate, in the country has developed a reputation for agility and versatility in the past few decades, continuing to tweak its core businesses to adjust to the changes in related industry and markets.
Now, the group believes it has finally found an optimized lineup to build a lucrative future. Doosan’s key businesses now range from building desalination and power-generation plants to heavy industry and low-power energy.
Doosan Chairman Park Yong-maan is confident he has all the pieces in place and the focus from now will be organic growth, although he won’t be shy if the right merger and acquisition (M&A) opportunity comes his way.
Doosan is expecting 2.2 trillion won (about $2 billion) in operating profit on sales of 29.1 trillion won this year, which will represent an annual rise of 29 percent and 11 percent respectively.
``In the past few years, Doosan has focused on increasing the number of winning products. In the next five years, we plan to put more effort on organic growth by improving internal management systems and advancing our technology capabilities,’’ Doosan spokesman Lee Jay-hyung said.
In spearheading the globalization process of Doosan, which had previously relied more on the domestic economy related to retail, food and beverages, Park had been an active hand in M&As.
His most notable acquisition was America engineering company Bobcat, which he believed would perfectly complement Doosan’s existing heavy industry business. The chemistry Park talked about is just beginning to show, with Bobcat, after years of struggling, showing improvement in profit and revenue.
Last year, Doosan completed another acquisition of the Chennai works of Austrian power company, AE&E, a move that gave the company a manufacturing base in fast-growing India.
Doosan Heavy, a key unit of the group, is among the top global companies involved in the business of building desalination facilities, with its facilities up and running in countries like the United Arab Emirates (UAE) and Saudi Arabia.
Doosan Engineering and Construction is also expecting significant demand for its 3-megawatt sea windmill systems, which have been approved by the international standardization agency recently.
Doosan Infracore, a business unit involved in machineries, is aiming high in lucrative emerging markets such as Brazil and China. It is also targeting Middle East and African markets with a new range of crawler excavators.
Doosan Infracore is currently building its billion dollar plant to produce excavators in Brazil, which will be operating sometime by the end of the year.
``Because our vehicles are designed for long-term reliability, we are finding increasing demands from developing economies,’’ Lee said.
China is generating much of Doosan Infracore’s orders for diesel engines that are used in trucks or power generators. The company is mulling the idea of finding a local partner to jointly build and operate manufacturing facilities in China.