On Aug. 29, Doosan's affiliates tumbled by more than 10 percent. The fall was prompted by analysis that the poor performance of Bobcat, the small American heavy equipment brand Doosan bought for US$5.1 billion last year, might cause low liquidity for the entire group.

Doosan explained it recently tried to improve its financial status by using a fund saved by giving up on the purchase of Daewoo Shipbuilding and Marine Engineering to repay Bobcat's debts. “There was some misunderstanding,” a company spokesman said. But few seem to believe the group. A stock market official said, "The basic reason that Doosan Group's stock prices have dropped is that it has lost the trust of the market."

One stock analyst was supposed to show up on a broadcast as a panelist last Thursday to explain about Doosan Infracore. Before appearing, He telephoned a Doosan-IR official to confirm the rumor that Doosan is planning to issue more shares because Bobcat has performed poorly. Doosan denied the rumor, but even as the show was running, the group abruptly announced it was issuing new shares. The stock analyst said he felt “betrayed.” Doosan claims it had no choice because it is against law to disclose information before it makes an announcement on the issuance of new shares. But critics say the gap between “We haven't decided yet" and outright denial is vast.

In a briefing in July, Doosan said Bobcat has been performing well. About a month later, the group has admitted that Bobcat's performance was poor. Once trust is lost, it takes a lot of time and effort to rebuild. It seems Doosan will have to pay dearly for shortsighted face-saving announcements about Bobcat and its lack of funds.

(englishnews@chosun.com )