Despite positive news related to the Doosan Czech nuclear power plant, the stock price of Doosan Energy is falling day by day.
The group’s business restructuring plan focused on “total profit”… Overlapping concerns from small shareholders,
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, ‘Despite the major positive news of securing a large contract for the Czech nuclear power plant, the stock price of Doosan Energy, which will play a key role in future main equipment deliveries, is falling. The impact is seen as a result of various factors such as controversy over low-cost contracts, institutional and foreign investors seeking profits, and recent shareholder backlash over business restructuring. While the government is actively working to ease the burden on top executives, it has somewhat neglected improving corporate governance structure such as protecting minority shareholders, which hasn’t resolved the “Korea discount” issue in the Korean stock market.’,
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, ‘On the 19th, the stock price of Doosan Energy closed at 22,000 won, down 3.81% (800 won) from the previous day. Following the confirmation of the new nuclear power plant order in Dukovany, Czech Republic, on the night of the 17th, Doosan Energy’s stock price continued to decline for two consecutive days.’,
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, ‘One of the fundamental reasons is said to be the ongoing business restructuring issue. The Doosan Group recently announced a business restructuring plan to split Doosan Bobcat from Doosan Energy and incorporate it as a wholly-owned subsidiary of Doosan Robotics. Concerns have been raised mainly by Doosan Energy and Bobcat shareholders about integrating Bobcat, a profitable company with nearly 1.3 trillion won in operating profit and close to 10 trillion won in annual sales, into Robotics, a company with only 53 billion won in revenue.’,
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, ‘On the other hand, through this restructuring, the top executives have gained advantages as Doosan’s indirect ownership of Bobcat has increased from 13.8% to 42.0%. While Doosan (corporation) with a stake of 58.0% owns only 30.39% of Doosan Energy’s shares, Robotics holds 68.2%, making the indirect ownership share for Bobcat even larger.’,
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, ‘In the future, the burden of funding support for Robotics, which requires a large investment, can be reduced. By making Bobcat a subsidiary with hundreds of billions of won in available dividends, the top executives can raise funds while maintaining control.’,
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, ‘Ultimately, this business restructuring is disadvantageous for minority shareholders and advantageous for top executives. Such concerns have been reflected in the recent stock price trends of Doosan Energy, undermining the government’s value-up policy.’,
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, ‘The government has focused on reducing the burden on top executives through measures such as separating dividend income taxation and easing inheritance tax, attributing the companies’ frugality in dividends to concerns that larger company valuations would lead to increased inheritance burdens later on.’,
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, ‘Experts point out that the root cause of the “Korea discount” lies in the fact that shareholder voices are not adequately reflected in the decision-making process during business restructuring. Therefore, they emphasize the need to introduce a “director’s duty of loyalty to shareholders” into corporate law to ensure that decisions involving potential conflicts of interest between controlling shareholders or executives and minority shareholders are also in the interest of the latter. Despite the positive intentions of the government, there is now a somewhat changed atmosphere due to continued backlash from the business community. Deputy Prime Minister Choi Sang-mok stated on the 17th, “We will not reach conclusions that worry business owners.”.\n’]