Daewoo creditors scrap sale to Videocon, finally

SEOUL: Creditors of Daewoo Electronics Corp scrapped their plan to sell the South Korean company to Videocon Industries Ltd and its partner, the Korea Economic Daily reported, citing an unidentified official at a creditor.

The creditors will seek to sell Daewoo to a Korean company after reorganising the electronics maker, the report said.

Daewoo’s creditors in January rejected a bid by Videocon and its bidding partner, a fund headed by Ripplewood Holdings LLC’s founder, to lower a 700 billion won ($759 million) offer for Daewoo. The Venugopal Dhoot company-led consortium has emerged as the preferred bidder to buy a controlling 97.6% stake in Daewoo Electronics. Daewoo has been under a creditor-led debt-restructuring programme since 2000 after its insolvent parent Daewoo Group was put under the workout programme.

Differences over the price have dogged the Videocon deal, ever since a memorandum of understanding was signed in October to sell Daewoo to the Videocn-led consortium. Some 40 creditors, led by Korea Asset Management Corporation and Woori Bank, have been in talks with the consortium to fix terms for the sale.