Doosan Corporation and Subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 and 2015 1. General Information 1.1 The Parent Company Doosan Corporation (“the Parent Company”) in accordance with Korean IFRS 1110 Consolidated Financial Statements was incorporated on December 18, 1933, under the name of Sohwa-Kirin Beer, Ltd. The Parent Company has changed its name to Dongyang Beer, Ltd. in February 1948, to OB Beer, Ltd. in February 1996, and to Doosan Corporation on September 1, 1998. In June 1973, the Parent Company listed its stock on the Korea Exchange. After several capital increases, the Parent Company’s share capital as at December 31, 2016 is ￦134,838 million, including ￦26,984 million of preferred shares. The Parent Company’s ordinary shareholders as at December 31, 2016, are as follows: Number of ordinary shares Percentage of owned ownership (%) Related parties 9,369,395 46.37 Treasury shares 5,276,455 26.11 Others 5,561,038 27.52 Total 20,206,888 100 Meanwhile, 48.3% of preferred shares are owned by the related parties including the largest shareholder, and 51.7% of preferred shares are owned by others entities and individual shareholders. 14 Doosan Corporation and Subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 and 2015 1.2 Consolidated subsidiaries Details of consolidated subsidiaries as at December 31, 2016 and 2015, are as follows: Ownership Ownership interest held by interest held by non-controlling Closing Type of the Group (%) 1 interests (%)1 date Subsidiary business Location 2016 2015 2016 2015 December Oricom Inc. Advertising Korea 65.5 66.9 34.5 33.1 31 December HanComm. Inc. Advertising Korea 100.0 100.0 34.5 33.1 31 December Doosan Bears, Inc. Sports Korea 100.0 100.0 - - 31 Manufacturing and December Doosan Feed & Livestock Co., Ltd. Korea 100.0 100.0 - - sales 31 December Doosan Tower Co., Ltd. 4 Real estate Korea 100.0 100.0 - - 31 December DIP Holdings Co., Ltd. Holding company Korea 100.0 100.0 - - 31 December DLI Corporation Training Korea 100.0 - - - 31 Software December DRA Inc. Korea 100.0 100.0 - - development 31 December Doosan Mecatec Co., Ltd. Manufacturing Korea 100.0 - - - 31 Research and December DAE Inc. Korea 100.0 - - - development 31 Doosan Electro-Materials Singapore Pte Wholesale and December Singapore 100.0 100.0 - - Ltd. retail 31 Wholesale and December Doosan Hongkong Ltd. China 100.0 100.0 - - retail 31 Doosan Electro-Materials (Shen Zhen) Wholesale and December China 100.0 100.0 - - Limited. retail 31 Doosan Shanghai Chemical Materials Wholesale and December China 100.0 100.0 - - Co., Ltd. retail 31 Doosan Electro-Materials (Changshu) December Manufacturing China 100.0 100.0 - - Co., Ltd. 31 Doosan Second Real Estate Specialized in December Korea 2 2 - - Securitization Specialty Ltd. 2 securitization 31 Doosan Information and Communications December IT service USA 100.0 100.0 - - America, LLC 31 Doosan Information and Communications December IT service China 100.0 100.0 - - China, Co., Ltd. 31 December Doosan Mottrol (Jiangyin) Co., Ltd. Manufacturing China 100.0 100.0 - - 31 Doosan Information & Communications December IT service UK 100.0 100.0 - - Europe 31 Wholesale and December Doosan Industrial Vehicle Europe N.A. Belgium 100.0 100.0 - - retail 31 Wholesale and December Doosan Industrial Vehicle U.K. Ltd. UK 100.0 100.0 - - retail 31 15 Doosan Corporation and Subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 and 2015 Ownership Ownership interest held by interest held by non-controlling Closing Type of the Group (%) 1 interests (%)1 date Subsidiary business Location 2016 2015 2016 2015 December Doosan Logistics Europe GmbH Manufacturing Germany 100.0 100.0 - - 31 Wholesale and December Doosan Industrial Vehicle America Corp. USA 100.0 100.0 - - retail 31 December Doosan Industrial Vehicle Yantai Co., Ltd. Manufacturing China 100.0 100.0 - - 31 Wholesale and December Genesis Forklift Trucks Limited UK 100.0 100.0 - - retail 31 December Rushlift Holdings Ltd. Holding company UK 100.0 100.0 - - 31 December Doosan Materials Handling UK Ltd. Holding company UK 100.0 100.0 - - 31 Wholesale, retail December Rushlift Ltd. UK 100.0 100.0 - - and lease 31 December Doosan Electro-Materials America, LLC Marketing USA 100.0 100.0 - - 31 Doosan Electro-Materials Luxembourg December Holding company Luxembourg 100.0 100.0 - - Sarl 31 December Circuit Foil Luxembourg Manufacturing Luxembourg 100.0 100.0 - - 31 December Circuit Foil Asia Pacific (Zhangjiagang) Manufacturing China 100.0 100.0 - - 31 Wholesale and December Circuit Foil Asia Pacific (Hong Kong) Hong Kong 100.0 100.0 - - retail 31 Wholesale and December Circuit Foil Trading Inc. USA 100.0 100.0 - - retail 31 December Doosan Fuel Cell America, Inc. Manufacturing USA 100.0 100.0 - - 31 Specialized in December Sunny Russell 8th Co., Ltd.2 Korea - - - - securitization 31 Other engine and Doosan Heavy Industries & Construction December turbine Korea 37.8 40.3 62.2 59.7 Co., Ltd. (“DHC”) 3 31 manufacture DOOSAN Asset Management Company Real estate December Korea 100.0 100.0 62.2 59.7 Co., Ltd development 31 Other engine and Doosan Heavy Industries Vietnam Co., December turbine Vietnam 100.0 100.0 64.1 61.7 Ltd. 31 manufacture December HF Controls Corp. Manufacturing USA 100.0 100.0 62.2 59.7 31 December HF Controls Corp. Manufacturing Korea 100.0 100.0 62.2 59.7 31 December PT. Doosan Heavy Industries Indonesia Manufacturing Indonesia 55 55 79.2 77.8 31 Wholesale and December Doosan Heavy Industries Japan Corp. Japan 100.0 100.0 62.2 59.7 retail 31 December S.C. Doosan IMGB S.A. Manufacturing Romania 99.9 99.8 62.3 59.8 31 16 Doosan Corporation and Subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 and 2015 Ownership Ownership interest held by interest held by non-controlling Closing Type of the Group (%) 1 interests (%)1 date Subsidiary business Location 2016 2015 2016 2015 Engineering and December Doosan Enpure Ltd. UK 100.0 100.0 62.2 59.7 service 31 Doosan Construction Site Solutions December Retail Vietnam 100.0 100.0 62.2 59.7 Vietnam Co., Ltd. 31 Engineering and Doosan Power Systems India Private Ltd. India 100.0 100.0 62.2 59.7 March 31 service December Doosan Heavy Industries Muscat LLC Manufacturing Oman 70 70 73.6 71.8 31 December Doosan Power Systems Arabia Manufacturing Saudi Arabia 51 51 80.7 79.4 31 December Azul Torre Construction Corporation 3 Manufacturing Philippine 40 - 84.9 - 31 Doosan Heavy Industries America December Holding company USA 100.0 100.0 62.2 59.7 Holdings LLC 31 December Doosan Hydro Technology LLC Manufacturing USA 100.0 100.0 62.2 59.7 31 Engineering and December Doosan Engineering & Services LLC USA 100.0 100.0 62.2 59.7 service 31 Wholesale and December Doosan Heavy Industries America LLC USA 100.0 100.0 62.2 59.7 retail 31 Engineering and December Doosan ATS America, LLC USA 100.0 100.0 62.2 59.7 service 31 Engineering and December Doosan Power Service America, LLC USA 100.0 - 62.2 59.7 service 31 Software and December Doosan GridTech Inc. system USA 100.0 - 62.2 - 31 engineering Software and December Doosan GridTech LLC system USA 100.0 - 62.2 - 31 engineering Software and December Doosan GridTech CA LLC system USA 100.0 - 62.2 - 31 engineering December Doosan Skoda Power s.r.o Manufacturing Czech 100.0 100.0 62.2 59.7 31 Skoda Power Private Ltd. Engineering India 100.0 100.0 62.2 59.7 March 31 Doosan Power Systems Pension Trustee Specialized December UK 100.0 100.0 62.2 59.7 Company Ltd. service 31 Doosan Power Systems Overseas December Holding company UK 100.0 100.0 62.2 59.7 Investments Ltd. 31 Engineering and December Doosan Babcock Ltd. UK 100.0 100.0 62.2 59.7 service 31 December Doosan Power Systems Holdings Ltd. Holding company UK 100.0 100.0 62.2 59.7 31 Doosan Power Systems Europe Limited Engineering and December Germany 100.0 100.0 62.2 59.7 GmbH service 31 Engineering and December Doosan Power Systems Americas LLC USA 100.0 100.0 62.2 59.7 service, 31 17 Doosan Corporation and Subsidiaries Notes to the Consolidated Financial Statements December 31, 2016 and 2015 Ownership Ownership interest held by interest held by non-controlling Closing Type of the Group (%) 1 interests (%)1 date Subsidiary business Location 2016 2015 2016 2015 Specialized December Doosan Lentjes UK Limited UK 100.0 100.0 62.6 60.1 service 31 Engineering and December Doosan Lentjes GmbH Germany 99 99 62.6 60.1 service 31 December Doosan Power Systems S.A. Holding company Luxembourg 100.0 100.0 62.2 59.7 31 Doosan Babcock Energy Technologies Engineering and December China 100.0 100.0 62.2 59.7 (Shanghai) Ltd. service 31 Doosan Babcock Energy Services Engineering and December UK 100.0 100.0 62.2 59.7 (Overseas) Ltd. service 31 Engineering and December Doosan Babcock Energy Polska Sp z.o.o. Poland 98.9 98.9 62.6 60.1 service 31 Engineering and December Doosan Babcock Energy Germany GmbH Germany 100.0 100.0 62.2 59.7 service 31 Specialized December Doosan Lentjes Czech s.r.o Czech 100.0 100.0 62.6 60.1 service 31 Dormant December AE & E Lentjes Belgie N.V. Belgium 100.0 100.0 62.6 60.1 corporation 31 Doosan Power Systems (Scotland) Ltd.