Creditors discuss sell-off of Daewoo Motor

Daewoo Motor's creditors have stated that should the sales negotiations with Hyundai and GM take an unacceptable turn, they will strongly consider dismantling the company to sell it piecemeal. A source among Daewoo's debt-holders revealed that a meeting of the management

committee has been scheduled for the morning of September 18 to discuss the sale of Daewoo as well as the possibility of fresh loan injections.

A source in the Industrial Bank, a major creditor of Daewoo Motor, stated that in the meeting attended by 12 of the creditor financial institutions, the sale of Daewoo Motor will be discussed. He added that as the 12 creditors account for 75% of the determining vote, their agreement will have binding force.

The government and the creditors are currently in favor of two prospective buyers who were outbid in the first round of bidding for Daewoo Motor. The two possible buyers have been named as the Hyundai-Daimler-Chrysler consortium and the GM-Fiat consortium.

It has been revealed that the meeting of the management committee will also discuss the possibility of dismantling the corporation and selling it piecemeal as well as designating a sales agent.

The creditors will also discuss the possibility of offering 1.5 billion won in fresh monthly loans to ride out the possible delay of the sale. However, as the Daewoo creditors have already injected the company with 2.5 trillion won in fresh loans, such a measure would likely draw heavy criticism.