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HHI Holdings Signs Definitive Agreement to Acquire Doosan Infracore

"Poised to conquer the global market as Korea’s leading construction equipment manufacturer"
A consortium consisting of Hyundai Heavy Industries (HHI) Holdings and KDB Investment (KDBI) announced on February 5 that it has signed a definitive agreement with Doosan Heavy Industries & Construction to take over Doosan Infracore.

Since submitting a bid for a controlling stake in Doosan Infracore in a preliminary tender held on September 28 last year, the consortium has been working on the due process required for acquisition for the past four months, including the preferred bidder selection on December 10 and signing of a binding memorandum of understanding (MoU) on December 23 last year.

Under the definitive agreement, the consortium will take over a 34.97% stake in Doosan Infracore from Doosan Heavy Industries & Construction for KRW 850 billion.

HHI Holdings is to support independent management of each subsidiary while also serving as a control tower to maximize synergies by strengthening the R&D function and coordinating overlapping investments for the sake of economies of scale.

In particular, the consortium has set the goal of elevating the two companies' positions from the current second-tier league to the top-tier league in the global construction market by heavily investing in future technologies, such as electric excavators and unmanned/automated technologies.

To that end, HHI Holdings will reinforce R&D human resources, while also making all-out efforts to ensure the employment security of Doosan Infracore employees and maintain the relationships with its existing business partners.

HHI Holdings will ask the Korea Fair Trade Commission and the authorities of other major countries, including China, to approve the acquisition of Doosan Infracore and plans to wrap up the process within the third quarter of 2021.

As the acquisition will bring another leading construction equipment maker under its umbrella in addition to Hyundai Construction Equipment (HCE), HHI Holdings aims to position itself as Korea's top player in the construction equipment industry, with a Group-level business portfolio focused on the critical infrastructure sectors, including shipbuilding, construction equipment, and refinery.

"I am pleased to welcome great talents of Doosan Infracore, the nation's top construction equipment maker, along with their valuable sales know-how, but it comes with great responsibility to further grow the business," said Kwon Oh-gap, Chairman of HHI Holdings. "To position both companies as top-tier players in the global construction equipment market, full support will be provided at the Group level for future technology investments aligned with changes in market trends."