Creditors of Kumho Tire
on March 10 approved Qingdao Doublestar’s plan to take over controlling stake in South Korea’s No. 2 tire maker, despite earlier speculation that the deal could be scrapped.
The nine creditor banks will sign the stock purchase agreement with the Chinese tire maker on March 13, according to the state-run Korea Development Bank, Kumho Tire’s main creditor.
The final deal price and conditions will be announced by Kumho Tire immediately after the transaction, KDB said.
Following the agreement, the creditors will notify Kumho Asiana Chairman Park Sam-koo of the deal details. Park holds the rights of first refusal in the sell-off that allows him to repurchase the stake by paying more than Doublestar’s offer. He has 30 days to make a decision and come up with financing plans.
Doublestar has reportedly placed its final bid of 955 billion won (US$824.90 million) to acquire 42.01 percent stake, or 66.36 million shares, of the nation’s second largest tire maker. It bid 14,389 won per share, a value around 80 percent higher than the firm’s current stock price of 8,220 won.
Earlier, Woori Bank, the leading creditor bank, raised objections to the deal saying it will approve the sale if Kumho Asiana Group -- who holds the trademark rights of the Kumho brand -- allowing Doublestar to use its logo after the acquisition. But Woori Bank decided to OK the sale at the last minute.
The final ownership of Kumho Tire will hang on whether the Kumho Asiana Group chief will be able to make the payment. Park has claimed that he has raised 1 trillion won from financial investors and strategic investors to buy back the company.
By Ahn Sung-mi (email@example.com