Creditors of Kumho Tire gave formal notice this week that they will hold an open auction for their respective holdings in the South Korean tyre manufacturer with preliminary bidding scheduled to start in early November.

The creditors involved are eight financial institutions including Woori Bank, state-owned Korea Development Bank and KB Kookmin Bank. Together they own 42% of the equity in the tyre manufacturer, worth some KRW760bn (US$680m) based on the current share price.

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Kumho Tire graduated from a four-year creditor-led debt restructuring programme at the end of 2014 after it suffered a severe liquidity crisis in 2009.

The 50 year-old tyre manufacturer currently employs around 5,000 people in South Korea. It has nine tyre plants worldwide, three in South Korea, four in China and one each in Vietnam and the US. It generated global sales of KRW3.04 trillion (US$2.7bn) last year.

In the first half of 2016, the company generated revenues of KRW1.45trn and earnings of KRW55.8bn.

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The auction will be organised by Credit Suisse bank which expects the final round of bidding to take place in January 2017 with a buyer expected to be selected shortly after that. The controlling equity stake is expected to cost around KRW1trn, including fees.

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Park Sam-koo, the current chairman of the former owner of the company,Kumho Asiana Group, will have the right of first refusal to buy back the shares by matching the highest bid in the final auction. He has previously indicated that he would be interested in taking back control of the tyre manufacturer but it is unclear whether he has the financial backing to do so.

Other global tyre companies will be given the chance to bid and private equity companies are also expected to feature in the auction.