ID :
101756
Fri, 01/22/2010 - 14:02
Auther :
Shortlink :
https://www.oananews.org//node/101756
The shortlink copeid
Kumho Industrial shares jump on reports of new workout plan
By Nam Kwang-sik
SEOUL, Jan. 22 (Yonhap) -- Kumho Industrial Co., a unit of South Korea's troubled Kumho Asiana Group, staged a brisk rally Friday on the Seoul bourse on reports that financial investors of Daewoo Engineering & Construction Co. plan to acquire a controlling stake in the company.
Shares of Kumho Industrial rose 11.2 percent to 5,770 won (US$5) as of 11:00 a.m.
on the Korea Exchange.
Financial Investors of Daewoo Engineering proposed Thursday a new plan to revive
Kumho Industrial, which was put under a debt workout program by creditors of
Kumho Asiana Group.
Under the new plan, the financial investors will buy a 50 percent stake plus one
share in Kumho Industrial for 2.2 trillion won (US$1.9 billion) to be funded by
local and foreign banks and local pension funds.
They plan to recoup their investment by selling stakes in Kumho Industrial if the
cash-strapped Kumho Group gets its management back on track.
The investors will also join a new share offering by Asiana Airlines Inc., the
group's flagship company and South Korea's second-largest carrier, by purchasing
shares worth 300 billion won.
"The core of the investors' plan rests on whether they can finance the
investments through foreign banks and local pension funds," said Choe Jeong-wook,
an analyst at Daeshin Securities Co., in a report.
Kumho Industrial promised its financial investors in 2006, when its parent group
bought Daewoo Engineering & Construction, that it would buy back their shares --
representing a 39 percent stake -- for 31,500 won each if the builder's stock
price fell below that price by Dec. 15, 2009.
The group bought a 72.1 percent stake in the builder for 6.42 trillion won, 3.5
trillion won of which was funded by financial investors, including banks and
private equity funds.
However, shares of Daewoo Engineering & Construction hovered below 13,000 won
late last year, leading to a severe cash shortage for the group.
Kumho Asiana agreed with its main creditor Korea Development Bank (KDB) to put
the group's two units -- Kumho Industrial and Kumho Tire Co. -- under a debt
rescheduling program to help the group ease the cash shortage on Dec. 30 of last
year after it failed to sell Daewoo Engineering & Construction.
ksnam@yna.co.kr
(END)
SEOUL, Jan. 22 (Yonhap) -- Kumho Industrial Co., a unit of South Korea's troubled Kumho Asiana Group, staged a brisk rally Friday on the Seoul bourse on reports that financial investors of Daewoo Engineering & Construction Co. plan to acquire a controlling stake in the company.
Shares of Kumho Industrial rose 11.2 percent to 5,770 won (US$5) as of 11:00 a.m.
on the Korea Exchange.
Financial Investors of Daewoo Engineering proposed Thursday a new plan to revive
Kumho Industrial, which was put under a debt workout program by creditors of
Kumho Asiana Group.
Under the new plan, the financial investors will buy a 50 percent stake plus one
share in Kumho Industrial for 2.2 trillion won (US$1.9 billion) to be funded by
local and foreign banks and local pension funds.
They plan to recoup their investment by selling stakes in Kumho Industrial if the
cash-strapped Kumho Group gets its management back on track.
The investors will also join a new share offering by Asiana Airlines Inc., the
group's flagship company and South Korea's second-largest carrier, by purchasing
shares worth 300 billion won.
"The core of the investors' plan rests on whether they can finance the
investments through foreign banks and local pension funds," said Choe Jeong-wook,
an analyst at Daeshin Securities Co., in a report.
Kumho Industrial promised its financial investors in 2006, when its parent group
bought Daewoo Engineering & Construction, that it would buy back their shares --
representing a 39 percent stake -- for 31,500 won each if the builder's stock
price fell below that price by Dec. 15, 2009.
The group bought a 72.1 percent stake in the builder for 6.42 trillion won, 3.5
trillion won of which was funded by financial investors, including banks and
private equity funds.
However, shares of Daewoo Engineering & Construction hovered below 13,000 won
late last year, leading to a severe cash shortage for the group.
Kumho Asiana agreed with its main creditor Korea Development Bank (KDB) to put
the group's two units -- Kumho Industrial and Kumho Tire Co. -- under a debt
rescheduling program to help the group ease the cash shortage on Dec. 30 of last
year after it failed to sell Daewoo Engineering & Construction.
ksnam@yna.co.kr
(END)
