U.S. fund picked as prime bidder for Daewoo Electronics

SEOUL, Oct. 29 (Yonhap) -- Creditors of Daewoo Electronics Co. picked a
U.S.-based private equity fund as the preferred bidder for a controlling stake in
South Korea's third-largest electronics maker, bank officials said Wednesday.
The creditors, led by the state-run Korea Asset Management Corp., will soon sign
a memorandum of understanding with Ripplewood Holdings LLC. Industry sources said
Ripplewood offered around 400 billion won (US$284 million) for the acquisition of
Daewoo Electronics.
Creditors said they plan to complete the prolonged sale of the electronics maker
by the end of the year.
Daewoo Electronics is a former unit of Daewoo Group, a local conglomerate that
collapsed in 1999 under debt totaling $80 billion.
The sale of Daewoo Electronics, which launched in October 2005, has been sluggish
due to labor disputes and disagreements over price.
In 2007, the creditors rejected a 700 billion won offer from a consortium led by
India's Videocon Industries Ltd. The sale stalled again earlier this year when
Morgan Stanley PE, a unit of global investment bank Morgan Stanley, scrapped its
bid for the electronics company in August.
The electronics giant has cut jobs and sold its non-core assets as part of
restructuring efforts. It is 98 percent owned by creditors, and posted an
operating income of 3 billion won on sales of 480 billion won in the second
quarter of the year.
In the first quarter, Daewoo Electronics logged a net profit of 5.5 billion,
swinging to the black for the first time in three years.