ID :
97985
Sun, 01/03/2010 - 20:05
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Shortlink :
https://www.oananews.org//node/97985
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KDB to lure strategic investors to buy Daewoo Engineering: sources
SEOUL, Jan. 3 (Yonhap) -- Korea Development Bank (KDB) is seeking to lure strategic investors including top steelmaker POSCO as part of its plan to buy troubled builder Daewoo Engineering & Construction Co., industry sources said Sunday.
On Wednesday, the country's main creditor bank KDB said a private equity fund led
by the lender will purchase a 50 percent stake plus one share in the construction
unit of South Korea's cash-strapped Kumho Asiana Group for 18,000 won (US$15.53)
per share.
Creditors earlier agreed to put the group's two key units -- Kumho Industrial Co.
and Kumho Tire Co. -- under a debt rescheduling program in a bid to help the
group avert a liquidity crisis after a series of reckless takeover moves.
"KDB plans to send investment offers to companies at home and abroad within the
month, and will seek to find strategic investors," an official at the state-run
lender said. He said the bank is considering asking POSCO to join the deal and
will sound out other large companies to see whether they are interested.
The move comes as Kumho faced a cash call worth around 4 trillion won from
financial investors, who exercised their rights to sell shares in Daewoo
Engineering back to the group on Thursday at above-market prices. Kumho
Industrial, the biggest shareholder of Daewoo Engineering, must repay the amount
by June 15.
Meanwhile, creditors and Kumho Asiana Group plan to come up with measures to
restructure the ailing units and finalize debt restructuring plans by the end of
February, sources said.
If the debt workout plans are laid out, creditors can convert debts into equity
and reduce capital. The debt-for-equity swaps will likely amount to around 2
trillion won.
The group's two other units -- Korea Kumho Petrochemical Co. and Asiana Airlines
Inc. -- will have to improve their finances through massive restructuring
efforts.
Creditors may consider putting Korea Kumho Petrochemical, the group's de facto
holding company, under the debt rescheduling program if its restructuring efforts
do not meet their expectations, they said.
They also noted that the family that owns the group must provide its real estate
holdings as collateral to show creditors its commitment to the corporate
overhaul.
The family said on Wednesday that it will put its assets, including stakes in
affiliates, into the hands of creditors as collateral to help improve the
conglomerate's financial health and shoulder responsibility in exchange for
maintaining its managerial rights over the group.
Kumho Asiana has been riddled with debt concerns after it bought a 72.1 percent
stake in Daewoo Engineering in 2006.
sooyeon@yna.co.kr
(END)
On Wednesday, the country's main creditor bank KDB said a private equity fund led
by the lender will purchase a 50 percent stake plus one share in the construction
unit of South Korea's cash-strapped Kumho Asiana Group for 18,000 won (US$15.53)
per share.
Creditors earlier agreed to put the group's two key units -- Kumho Industrial Co.
and Kumho Tire Co. -- under a debt rescheduling program in a bid to help the
group avert a liquidity crisis after a series of reckless takeover moves.
"KDB plans to send investment offers to companies at home and abroad within the
month, and will seek to find strategic investors," an official at the state-run
lender said. He said the bank is considering asking POSCO to join the deal and
will sound out other large companies to see whether they are interested.
The move comes as Kumho faced a cash call worth around 4 trillion won from
financial investors, who exercised their rights to sell shares in Daewoo
Engineering back to the group on Thursday at above-market prices. Kumho
Industrial, the biggest shareholder of Daewoo Engineering, must repay the amount
by June 15.
Meanwhile, creditors and Kumho Asiana Group plan to come up with measures to
restructure the ailing units and finalize debt restructuring plans by the end of
February, sources said.
If the debt workout plans are laid out, creditors can convert debts into equity
and reduce capital. The debt-for-equity swaps will likely amount to around 2
trillion won.
The group's two other units -- Korea Kumho Petrochemical Co. and Asiana Airlines
Inc. -- will have to improve their finances through massive restructuring
efforts.
Creditors may consider putting Korea Kumho Petrochemical, the group's de facto
holding company, under the debt rescheduling program if its restructuring efforts
do not meet their expectations, they said.
They also noted that the family that owns the group must provide its real estate
holdings as collateral to show creditors its commitment to the corporate
overhaul.
The family said on Wednesday that it will put its assets, including stakes in
affiliates, into the hands of creditors as collateral to help improve the
conglomerate's financial health and shoulder responsibility in exchange for
maintaining its managerial rights over the group.
Kumho Asiana has been riddled with debt concerns after it bought a 72.1 percent
stake in Daewoo Engineering in 2006.
sooyeon@yna.co.kr
(END)
