Kumho Restructuring Deal Hits Snag: Reports
The Korea Times has reported (on 19 January, 2010) that creditor-led restructuring of the cash-strapped Kumho Asiana Group has started off badly. Reports say that disputes are growing between the group, creditors and other stakeholders over how to resolve major issues surrounding debts from Kumho’s takeover of Daewoo Engineering & Construction in 2006. Separately, the debt workout programs of Kumho Industrial and Kumho Tire have hit rocky ground as founding family members and creditors are in disagreement over how to restructure the group. Creditors insist Kumho Petrochemical, the group's de facto holding firm, and Kumho Asiana Airlines should be subject to the debt repayment plan.
Kumho opposes such a move, claiming it would lose managerial control over the entire group if Kumho Petrochemical was placed under creditor bank control. In addition, controlling family members have not met the Korean Development Bank demands that they deliver their shares in Kumho stocks and other personal assets as collateral for new restructuring loans. (Tire Review)