Acquisition of Business Unit Sold by Doosan in 2020
Motrol Holds Core Hydraulic Technology for Industrial Equipment
Vice Chairman Scott Park: "Creating Synergy and External Growth"
Doosan Bobcat has laid the foundation for Doosan Group's leap forward beyond just business normalization by reacquiring a business division previously sold by Doosan Corporation.
On the 12th, Doosan Bobcat announced that its board of directors resolved to acquire 100% of the shares of Motrol, a specialized company in hydraulic parts for heavy equipment, for 246 billion KRW. Doosan Bobcat explained, "The purpose is to strengthen competitiveness by securing hydraulic technology, a core component of industrial equipment."
Motrol is a business division that Doosan Group sold in December 2020 to a consortium of private equity firms Socios PE and WelltoSee Investment. Motrol began developing hydraulic devices for the first time in Korea in 1974. It was acquired by Doosan Heavy Industries in 2008 and became Doosan Motrol, then merged into Doosan Corporation in 2010, becoming the Motrol business division. At that time, Doosan Group spun off Motrol as a wholly owned subsidiary of Doosan and sold Motrol’s shares through a stock transfer method for 453 billion KRW .
Motrol was a valuable affiliate in which Doosan had invested for over 10 years. At the time of sale in 2020, it recorded consolidated sales of 663.8 billion KRW and operating profit of 57.8 billion KRW, accounting for 16.76% of Doosan’s own business operating profit.
However, Doosan Corporation had no choice but to sell Motrol to normalize the management of its major affiliate Doosan Heavy Industries (now Doosan Enerbility), which was facing a liquidity crisis. From March 2020 to February 2022, under creditor management for about two years, Doosan Group restructured its overall business and sold key affiliates including Motrol, Doosan Tower, golf club Club Mow CC, Doosan Solus, and Doosan Infracore.
This acquisition of Motrol is evaluated as a turning point for Doosan Group to shake off financial risks and actively prepare for a new leap forward. In 2020, while selling core affiliates, Doosan Group reorganized its business portfolio toward future-oriented sectors such as nuclear power, wind power, and robotics.
Recently, with the strong performance of key affiliates such as Doosan Enerbility, Doosan Fuel Cell, and Doosan Robotics, which are engaged in small modular reactors (SMR), hydrogen fuel cells, and industrial robot businesses, the 128-year-old Doosan Group is entering another golden age.
In particular, Doosan Bobcat is rapidly growing as its main market, the North American construction equipment market, enters a boom period due to infrastructure investment policies. Last year, North American sales rose 15% year-on-year to $561 million (about 7.7 trillion KRW), and operating profit has exceeded 1 trillion KRW annually, establishing itself as the group’s cash cow. Based on a substantial cash asset of 1.8007 trillion KRW as of the first quarter, it took the lead in acquiring Motrol. The plan is to create synergy by combining Motrol’s hydraulic technology, which is essential for industrial equipment, with Doosan Bobcat’s products and technology.
Scott Park, Vice Chairman of Doosan Bobcat, said, "Doosan Bobcat and Motrol, both equipped with world-class products and technology, will create synergy through vertical integration while expanding Motrol’s scale through external volume growth."
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