Creditors and Hyundai at odds

Plans for former Hyundai honorary chairman Chung Joo-Young to sell his Hyundai Motors holdings and use the proceeds to alleviate the liquidity crunch being experienced by Hyundai Construction have surfaced. Managing Director Hwang Hak-Joong of Korea Exchange Bank, Hyundai`s main creditor bank, revealed at a press conference on the 10th that discussions are taking place on main issues, such as the details of Hyundai`s rehabilitation plan and the sale of Hyundai Motor shares held by former chairman Chung Joo-Young to mitigate struggling Hyundai Construction`s liquidity problems.

Until now, Hyundai has stood firm on its position that the separation of Hyundai Motor from the group through the sale of former chairman Chung`s shares is acceptable, but use of the proceeds to support Hyundai Construction was not possible.

Managing Director Hwang added that as long as Hyundai Construction`s liquidity problems are fixed quickly, the sale of Hyundai Heavy Industries and Hyundai Merchant Marine shares held by the construction arm is not required. An exchangeable bond can be issued instead, he said.

A Hyundai official remarked that in the new rehabilitation plan fund-raising schemes not mentioned in the previous plan had been included, such as the sale of an ¡°officetel,¡± a hotel-style office, in

China and a hotel in Vladivostok together with the recovery of apartment related receivables.