Doosan Co., the holding company of Doosan Group, the No. 18 conglomerate by ranking, will give up its status as a holding company.
According to the industry on the 26th, the Fair Trade Commission reviewed the audit report and the status of shareholdings that Doosan submitted earlier this month to be exempted from the application of holding company rules, and notified the company of its exclusion from the holding company category. As a result, Doosan has been freed from various regulations that holding companies are subject to under the Monopoly Regulation and Fair Trade Act.
A holding company is a company whose main business is controlling corporations through shares and other means. It must meet two conditions: "total corporate asset aggregates of at least 500 billion won" and "a ratio of subsidiary share value to total asset aggregates of 50% or more."
As of the end of last year, Doosan's total asset size was 5.053 trillion won, and the ratio of subsidiary share value to total asset aggregates was more than 60%. Then, in Jun., as it borrowed funds worth 550 billion won with shares of Doosan Robotics as collateral, its total asset aggregates increased, causing it to fail to meet the "holding ratio (subsidiary share value/total asset aggregates) of 50% or more" standard.
Once it steps out of the holding company framework, Doosan will find it easier to pursue mergers and acquisitions and gain the advantage of being able to make joint investments in affiliates. Holding companies are regulated so that their liability ratio must not exceed 200%, and they must hold at least 30% equity in listed companies and 50% or more in unlisted companies. Doosan will now be able to hold shares not only in subsidiaries but also in other domestic affiliates and financial companies. The exclusion from holding company status is applied retroactively to Jun.