Creditors of Kumho Tire Co. could not assess the latest self-rescue plan by the South Korean tiremaker due to lack of details, officials said Wednesday.
The move came a day after the tire unit of Kumho Asiana Group submitted the self-rescue plan to its main creditor, the state-run Korea Development Bank (KDB).
Under the plan, Kumho Tire said it can raise 630 billion won (US$558 million) by selling its money-losing plant in China and injecting capital worth 200 billion won through a rights issue.
The tiremaker also said it plans to sell its 4.4-percent stake in Daewoo Engineering & Construction Co. to secure liquidity worth around 130 billion won.
Still, creditors need specific explanations from Kumho Tire, said an official at KDB.
The official said the company could not sell its 4.4-percent stake in Daewoo Engineering & Construction Co. without the consent of its creditors as the stake is held as collateral by the creditors.
Kumho Tire said its officials met with their counterparts from the creditors on Wednesday to further explain the self-rescue plan.
The KDB official said its creditors will hold a meeting to discuss the self-rescue plan, though he said no specific time frame has been set.
In March, China's Qingdao Doublestar signed a 955 billion won contract with the creditors led by KDB to buy a 42.01 percent stake in South Korea's second-biggest tiremaker.
The deal, however, unraveled as the creditors rejected Doublestar's demand to cut the purchase price by 16 percent to 800 billion won, citing deteriorating earnings. Doublestar on Wednesday sent a document to KDB that agrees to the termination of its stock purchase agreement and officially ended its pursuit of acquiring Kumho Tire.
The creditors have pressured Kumho Asiana Group, saying a process can be undertaken to dismiss Park and his senior management if the group does not file a satisfactory restructuring plan.
|This file photo taken on Jan. 30, 2017, shows Kumho Tire Co.'s plant in Gwangju. (Yonhap)|
Hwi Won firstname.lastname@example.org
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