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Strategies & Market Trends : China Warehouse- More Than Crockery -- Ignore unavailable to you. Want to Upgrade?

To: RealMuLan who wrote (2114)	12/19/2003 12:17:16 AM
From: RealMuLan	Read Replies (1) \| Respond to of 6370

China’s Bluestar bid for Ssangyong recommended SEOUL: A Chinese petrochemicals group has been recommended as the preferred bidder to take over South Korea's Ssangyong Motors, which specialises in sport utility and recreational vehicles, a key creditor bank said yesterday. Chohung Bank said a meeting of creditors would be held later in the day to review the recommendation from a domestic audit firm which manages the sale of a controlling 55.4% stake in the sport utility vehicle and sedan maker. “Samil Accounting Corp recommended China National Bluestar Group as the priority negotiator and creditors are expected to endorse the recommendation,” Chohung spokesman Kim Won-Gyum told AFP. “The review will take several days, and I think a final decision may come this week,” he said. The group beat US auto giant General Motors and several other foreign carmakers that had applied to buy Ssangyong, he said. Ssangyong, the country's fourth largest motor vehicle company, has been controlled by creditors since 1999 after its parent, Ssangyong Group, collapsed after the country's 1997/98 financial crisis. The company has been under a creditor-led restructuring programme while looking for buyers. Analysts here say Ssangyong has a better sales outlook for next year, with domestic consumption seen rebounding. It recorded a net profit of 306.2 billion won on sales of 1.72 trillion won (US$1.53bil) in the first half this year thanks to strong sales of its main sport utility model, Rexton. If approved, the Chinese group would start exclusive talks with creditors, which hold more than 75% of the debt owed by Ssangyong. The Chinese group planned to invest US$1bil in Ssangyong and its Chinese auto-related operations, Kim said, adding that creditors hoped to sign a memorandum of understanding by the end of this month. It also offered other incentives such as plans to invest more in Ssangyong's research and development and bolster its after-service network in China. “Creditors have no reason to reject Samil's recommendation because the Chinese group presented really good terms, including price,” Kim said. The proposal included a pledge to ensure job security and retain Ssangyong's current management, he said, adding the Chinese group was also ready to respect a labour-management agreement. – AFP biz.thestar.com.my