In the continuing saga of the General Motors takeover of Daewoo, the latest news is that the US vehicle giant now wants to buy fewer of the Korean company#;s assets than it agreed to purchase for $1.2 billion in September, complicating efforts to sell the insolvent South Korean automaker, The Detroit News said.
GM doesn’t want some overseas sales units and two overseas plants it had agreed to buy in September, Han Dae Woo, an official at Korea Development Bank, which is handling Daewoo Motor’s sale, told the Detroit News. The newspaper added that GM declined to comment on specifics of the negotiations.
The Detroit News said that GM agreed last September to give Korean creditors about $US2.6 billion to revive Daewoo, once South Korea’s second-biggest vehicle maker, and use it as an Asian export base and to increase sales in the region’s second-largest car market.
“A delay in talks means that there are difficulties,” Lee Young Seog, an analyst with Dongwon BNP Investment Trust Management Co. in Seoul, told the Detroit News. “But eventually, a final agreement will be reached with General Motors because there aren’t a lot of choices for creditors to take.”
GM spokeswoman Toni Simonetti told the newspaper that the September agreement was a nonbonding framework for the current negotiations and that the company was confident of an agreement though both sides were bound by a confidentiality agreement.
The Detroit News said GM last month said it hoped to complete a deal by the end of April.