By Kim Yoo-chul
Korea's Doosan Group appears to have failed to close a lucrative deal to build a power plant in Saudi Arabia, which may prove to be a setback for its ambitions to flex its global muscle.
Doosan had aimed to get about 60 percent of its targeted 24 trillion won ($20.5 billion) in revenue for this year and the Saudi Arabian project was considered a prerequisite for the company achieving its goal.
Doosan, which relies on its duo of heavy industry units Doosan Heavy and Doosan Infracore to spearhead its attempts for going global, has been looking to exploit the growing demand for new power plants.
Doosan Heavy was euphoric went it was named by the Saudi Arabia's state-run Saudi Electricity Company (SEC) as the preferred bidder to build a 2,400 megawatt power plant in the country, a deal that is thought to be worth up to $4.34 billion.
However, the SEC recently withdrew its commitment to Doosan Heavy and declared to restart the bidding process, according to industry sources.
"SEC notified Doosan that it will restart the bidding process, which will continue through Aug. 14, with the winner being announced in September," said a senior industry official, asking not to be named, Wednesday.
With SEC initiating a second round, Doosan is expected to face tougher competition from domestic rival Hyundai Heavy Industries and France's Alstom.
Doosan executives downplayed the potential effect of SEC's decision, claiming that it is just a speed bump in the company's efforts to strengthen its position in global markets.
"SEC is apparently looking for lower offers than our original $3.94 billion to reduce costs. However, the reconsideration won't mean a trip back to the drawing board," said Bae Hyung-sik, a senior Doosan spokesman, who confirmed that SEC has offered Hyundai and Alstom to retry.
"We are confident that we will win the deal again."