Media reports in South Korea suggest that General Motors' Korean operations are facing mounting debt as GM struggles to find agreement on restructuring after announcing that one assembly plant is to close.

The company must come up with ways to pay a combined 2.3 trillion won (US$213m) for voluntary resignations and loans, according to the Korea Herald.

The maturity date for the 700 billion won GM Korea borrowed from its headquarters expires later this month, the report says.

The report added that the automaker's board members agreed last month to postpone the loan's due date by a month while the Korea Development Bank and GM conduct due diligence on the automaker's financial records.

Between April 1 and 8, GM Korea also has to pay back loans worth 980 billion won along with interest of up to 5.3 percent to affiliates and the headquarters, according to an audit report on GM Korea.

According to the Herald, the automaker needs to pay 500 billion won in cash to 2,500 workers who applied for voluntary resignations last week, by the end of April.

Analysts now suggest that a debt for equity deal for the subsidiary may offer a solution.

Some reports suggest that GM has already asked the state-run KDB, the second-largest shareholder of GM Korea, to partially cover liabilities for voluntary redundancies.

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