KDB mulling backup plans for Daewoo Engineering: chief

SEOUL, Dec. 18 (Yonhap) -- Korea Development Bank (KDB) is considering drawing up
contingency plans in case the sale of Daewoo Engineering & Construction Co. hits
a snag, its chief said Friday.
In late November, liquidity-squeezed Kumho Asiana Group picked two foreign funds
-- Jabez Partners and TR America Consortium -- as preferred bidders for a
controlling stake in its construction unit, with the aim of selling it within
this year.
To help it sell Daewoo Engineering, the group requested 18 financial investors to
hold off on exercising their rights to sell back the stakes until Jan. 15. One
investor has exercised a put-back option for the builder.
"Although we expect the sale of Daewoo Engineering to go smoothly, KDB, as a main
creditor bank, is mulling 'Plan B' to prepare for a possible failure of the
sale," Min Euoo-sung, chairman of KDB Financial Group Inc., told reporters.
Min noted that Kumho Group is known to be doing fine-tuning to select the final
bidder and KDB is willing to provide financial support to an investor if it has
genuine commitment to buying the builder.
Meanwhile, Min reiterated that KDB is not considering providing additional
financial support to ailing carmaker Ssangyong Motor Co. if a definite buyer
emerges.
A South Korean bankruptcy court approved Thursday a turnaround plan by troubled
Ssangyong Motor, giving the debt-ridden carmaker a chance to revive its
struggling business.
In August, the policy lender decided to provide financial aid worth 130 billion
won (US$110.6 million) to help the carmaker normalize its operations. South
Korea's smallest automaker, which has been under bankruptcy protection since
February, has asked for emergency funding of up to 150 billion won from KDB to
cover its restructuring expenditures and develop a new compact sport utility
vehicle. But KDB rejected its fund request for vehicle development.
He said that KDB will seek to sell Daewoo Shipbuilding & Marine Engineering Co.,
but it will not be in a hurry to sell the shipbuilder.
"We will look for a buyer which could help beef up global competitiveness in the
Korean shipbuilding industry and promote Daewoo Shipbuilding's long-term growth,"
Min said.
The sale of the world's third-largest shipyards is being re-pushed after the bank
scrapped a deal to sell a combined 50.4 percent stake in the company to Hanwha
Group in January this year.
sooyeon@yna.co.kr
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