Sale of Daewoo Electronics ruptures over price disagreement

SEOUL, Jan. 7 (Yonhap) -- Creditors of Daewoo Electronics Co. have decided to end
negotiations with a U.S.-based private equity fund to sell a controlling stake in
South Korea's third-largest electronics maker due to disagreement over price,
industry sources said Wednesday.

The creditors, led by the state-run Korea Asset Management Corp., have negotiated
with Ripplewood Holdings LLC since October, but the both sides failed to reach
an agreement on price.
Industry sources said Ripplewood had initially offered 400 billion won (US$309
million), but demanded a lower price due to the global credit crunch, a bid
which was rejected by Daewoo Electronics creditors.
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 last 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 98 percent owned by creditors has cut jobs and sold its
non-core assets as part of restructuring efforts.
sam@yna.co.kr
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