April 20, 2024

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[THE INVESTOR] The state-run Korea Development Bank is set to complete injecting US$750 million into the Korean unit of General Motors on Dec. 26, after it backed a plan to spin off the carmaker’s research unit.

KDB and GM signed a deal in May on the rescue package for GM Korea. Under the agreement, the KDB pledged to inject US$750 million, while GM agreed to provide US$3.6 billion in fresh loans to keep the local unit afloat. 

In June, the KDB injected US$375 million into GM Korea, but the bank had previously said the other half may not be provided amid concerns that the U.S. carmaker may only keep its research facility in South Korea and eventually shut down its manufacturing facilities here.

Earlier this month, the KDB reversed its stance for the spin-off plan, saying it would help GM Korea improve its profitability.

KDB plans to buy about 11.9 million preferred shares of GM Korea for 404.5 billion won ($358.90 million), or 33,932 won per share.

By Song Seung-hyun and newswires (ssh@heraldcorp.com)