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Kumho Tire Workers Strike Over Sale Plan
Hourly workers at Kumho Tire Co. in South Korea staged a one-day strike today to protest plans to sell the ailing company to China’s Qingdao Doublestar Co.
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Hourly workers at Kumho Tire Co. in South Korea staged a one-day strike today to protest plans to sell the ailing company to China’s Qingdao Doublestar Co.
Kumho’s net losses more than doubled last year to 89 billion won ($84 million) as sales revenue declined 2% to 2.9 trillion won. In December the company hired back its former CEO, Kim Jong-ho, to help revive the company and push through the sale.
Creditor Korea Development Bank claims that Kumho’s only chance of survival is to be sold to Doublestar. The Chinese company proposed to invest 646 billion won ($607 million) to buy new shares in the tiremaker and spend another 200 billion won to upgrade facilities.
Doublestar also has offered to guarantee jobs for Kumho’s workers for three years. The company operates factories in Korea, China and the U.S.
KDB is asking Kumho’s Korean union to vote on the merger proposal by the end of March. Korea’s Yonhap news service says the tiremaker’s current value of 460 billion won compares with its liquidation value of 1 trillion won.
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