Kumho Tire delisting as military supplier

8th May 2018 | 0 Comments
 

A very small percentage of Kumho Tire’s output in recent years was shipped to the Republic of Korea Air Force for its F-16 fighter and T-50 trainer jet, and this military business was a complicating factor in the sale a 45 per cent stake in the tyre maker to China’s Doublestar Tyre. Following the vote to accept Doublestar’s KRW 646.3 billion (£441.9 million) bid, Kumho Tire has requested that South Korea’s government cancel its designation as a defence-related company. This request is now being reviewed.

Had Kumho Tire wished to retain this status, approval from the country’s Ministry of Trade, Industry and Energy as well as its Defense Acquisition Program Administration would have been necessary prior to selling the shareholding to a foreign company.

According to The Korea Herald, Kumho Tire makes approximately KRW 1.6 billion (£1.1 million) from its military aircraft tyre business. The publication also reports that Kumho Tire’s creditors, including the Korea Development Bank, may be planning to sell the tyre maker’s defence-related business to a third party in South Korea. It comments that divestment of this business should speed up the finalisation of Doublestar’s acquisition.

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Category: Company News, International News

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