State-run Korea Development Bank on March 12 kicked off due diligence of GM Korea as it prepares to make a decision on extending fresh loans to the loss-making carmaker.
“There were differences between the KDB and GM over the conditions involving due diligence, but they reached an overall agreement on various aspects,” KDB Chairman and CEO Lee Dong-gull told reporters.
GM holds a 77 percent stake in the local unit of the carmaker, while the Korean lender holds 17 percent and SAIC Motor possesses 6 percent shares.
In a meeting with GM Executive Vice President Barry Engle last week, the chairman said GM will amend its initial stance of not providing most of the requested materials and will cooperate with the KDB so that due diligence can be carried out smoothly based on bilateral trust.
GM asked the KDB to complete due diligence within a month, but the state lender demanded two to three months as it needs to thoroughly review GM Korea’s financial status and its parent GM’s investment plans in its Korean unit before deciding on new loans.
By Song Seung-hyun and newswires (firstname.lastname@example.org