Bobcat Merger Called Off with Doosan Robotics

After opposition from shareholders and political leaders, Doosan Bobcat has scrapped its plans to merge with Doosan Robotics.

“We believe that no restructuring of the business or corporate governance can be accomplished without full trust and support of our shareholders,” wrote Doosan Bobcat CEO Scott Park in an August 29 letter to investors.

“Consequently, after a thorough review and internal discussions, the Company has decided to accept the market’s views, and the Board of Directors resolved on August 29, 2024, to withdraw the proposed comprehensive share exchange.”

The merger and stock exchange were announced July 11, causing an immediate backlash from minority shareholders. They said the stock-swap ratio of the proposed merger undervalued Bobcat, a leading revenue producer, while overvaluing Doosan Robotics, which has been losing money.

Korean government regulators also suspended Doosan Robotics’ prospectus over inaccuracies, effectively putting the merger on hold.  

Under the former merger plan, Bobcat would have been spun off from Doosan Enerbility, which focuses on clean energy, and become a fully owned subsidiary of Doosan Robotics by the end of the year.   

Both Bobcat and Doosan Robotics are subsidiaries on the Doosan Group conglomerate. Their merger was viewed by corporate leadership as a way to advance robotics in its compact equipment products and their production while also positioning the company for rapid economic growth expected in artificial intelligence, autonomous operation and robotics.

“We continue to believe that the proposal would support sustainable long-term growth and represent a valuable opportunity to align both shareholder interest and the Company’s objectives,” Park wrote.

But shareholder opposition convinced the board that the plan was no longer viable.

“We regret the confusion this has caused,” he wrote. “We are committed to seeking out and considering the thoughts and opinions of the market to become a company that earns greater trust from our valued shareholders.”

He added that the company would continue to “seek ways to create synergies with Doosan Robotics, including reviewing the business restructuring based on the communication with the market and regulatory changes.”

Though it appears for now Bobcat will not fully merge with Doosan Robotics, the robotics company plans to acquire 46% of Bobcat stock from Doosan Enerbility. That would make it a Doosan Robotics subsidiary. Doosan Bobcat would remain listed on the Korean stock exchange, rather than delisted as would have occurred under the merger plan.