Doosan Bobcat Owners Seek South Korea’s Biggest IPO in Six Yearsby and
Shareholders look to raise up to $2.2 billion from sale
To gauge demand for share offering from Oct. 6 to Oct. 7
Doosan Bobcat Inc.’s owners are planning what could be South Korea’s biggest initial public offering in more than six years as the manufacturer of excavators and loaders looks to raise as much as 2.45 trillion won ($2.2 billion) in a share sale next month.
Shareholders of the company, an arm of South Korea’s biggest construction equipment maker, will offer about 49 million existing shares at 41,000 won to 50,000 won apiece, according to a regulatory filing Thursday. Doosan Bobcat will gauge demand for the share sale from Oct. 6 to Oct. 7 and plans to take investor orders from Oct. 12 to Oct. 13.
Doosan Bobcat joins Samsung Biologics Co. in braving an IPO market that’s had the second-worst performance among major Asian bourses. The Seoul-based company, which got about 70 percent of its sales of 4.04 trillion won last year from North America, has been seeking to expand in emerging markets including China and Southeast Asia to generate more growth opportunities.
“Our priorities are on reinforcing competitiveness in emerging markets, providing locally-customized products, and investing in distribution channels and a sales service network,” Doosan Bobcat said in a statement. “We have built a stable business foundation owing to steady housing market growth in North America and the expansion of high-end product sales.”
The company plans to announce the final price on Oct. 10 and begin trading Oct. 21, according to the filing. Doosan Infracore Co. will sell 23.2 million Doosan Bobcat shares in the offering.
Shares of Doosan Infracore have surged 90 percent this year, compared with the 5.2 percent gain in the benchmark Kospi index.
The offering will add to the $1.7 billion raised from first-time share sales in South Korea this year, down from $1.9 billion during the same period in 2015, data compiled by Bloomberg show. Samsung Life Insurance Co.’s share sale raised 4.9 trillion won in 2010.
Korea Investment & Securities Co. and JPMorgan Chase & Co. are leading the offering. Credit Suisse Group AG, HSBC Holdings Plc, Hanwha Investment & Securities Co. and Shinyoung Securities Co. are also helping arrange the share sale.
Doosan Infracore bought Ingersoll-Rand Co.’s Bobcat business and other equipment units in 2007 for $4.9 billion, the biggest overseas deal by a South Korean company. Doosan Bobcat posted 234.8 billion won in operating profit in the first half of this year and generated sales of 2.15 trillion won, the company said. Its operating margins widened to 10.92 percent in the first half, from 9.54 percent for 2015.
The company is pursuing a listing after South Korean policy makers revised IPO rules late last year. The regulator eased documentation requirements for Korean companies with businesses abroad, making it easier for firms like Doosan Bobcat that have many overseas units.