Kumho Asiana chief not to exercise buyback option without reply from KDB
SEOUL-- The chief of Kumho Asiana Group will not exercise his right to buy back the logistics conglomerate's tiremaking affiliate currently under creditors' control, unless its main creditor, the state-run Korea Development Bank, allows him to form a consortium for the potential takeover, the group said Wednesday.
The creditors, led by the KDB, said earlier they would review whether to allow Park Sam-koo, chairman of the logistics conglomerate, to exercise his right to buy back Kumho Tire Co. after receiving the plan, which they have requested.
Park is required to show his intention if he wants to take over Kumho Tire and submit the financing plan by an April 19 deadline.
"We sent a notice to the KDB asking to give an answer to our inquiries by April 17, including the formation of a consortium," the group said. The group said chairman Park would not exercise his buyback rights "this time," unless the lender gives an answer by the deadline.
The head of Kumho Asiana Group has been urging creditors to allow him and the special purpose company he created to buy the tiremaker.
But the creditors have been reluctant to do so because they believe that Park may face difficulties getting the necessary funding.
Park countered that he would take legal action against the creditors of Kumho Tire for denying its right to buy back the former affiliate. Kumho Asiana said earlier that the legal measures will likely include a court injunction against the proposed sale of Kumho Tire to a consortium led by a Chinese firm.
The KDB-led creditors have said they will move forward with the sale of Kumho Tire to Chinese tiremaker Doublestar, unless the Kumho Asiana chairman formally expresses his takeover intentions.
Kumho Tire was placed under a creditor-led workout program in 2009 after its parent company was hit by a liquidity problem following its takeover of Daewoo Engineering and Construction Co.
At that time, Park was given a priority option to buy back the country's tiremaker should the creditors of Kumho Tire decide to sell the company.
The creditors signed a deal earlier this month to sell their combined 42.01 percent stake in the tiremaker to Doublestar for 955 billion won (US$831 million).
Source: Yonhap News Agency