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Kumho Tire Bailout Moves Closer
Kumho Tire Co. says the Chinese company that aims to buy 45% of the struggling South Korean tiremaker has vowed to guarantee the business’s management independence.
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Kumho Tire Co. says the Chinese company that aims to buy 45% of the struggling South Korean tiremaker has vowed to guarantee the business’s management independence.
Qingdao Doublestar Co. is offering to invest 646 billion won ($613 million) to acquire its stake in Kumho and another 200 billion won ($190 million) to upgrade the company’s manufacturing facilities.
Hourly workers staged a one-day strike in mid-March to protest the deal, preferring efforts to find Korean investors to save the company. But employees voted last week to approve the Doublestar plan after the state-run Korean Development Bank, a major creditor, threatened to push Kumho into court-controlled receivership.
Kumho has been under the control of its creditors for a decade. Last year the company reported its net loss more than doubled to 89 billion won ($84 million).
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