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Technology Stocks : Alliance Semiconductor -- Ignore unavailable to you. Want to Upgrade?

To: Taro who wrote (4478)	1/11/1999 10:25:00 AM
From: DJBEINO	Respond to of 9582

01-12-99 LG's adamant stance aims at more concessions in chip merger talks The LG Group stuck fast to its hardline stance in its semiconductor merger talks with Hyundai Group yesterday, calling for rehiring all LG Semicon employees by Hyundai Electronics Ind. for five to seven years after their merger. In a similarly tough stance, LG said it will not back away from its earlier demand for cash payments for the sale of LG Semicon. The nation's fourth largest conglomerate also declared an intent to exclude any third-party interventions in upcoming negotiations with Hyundai. LG's announcement dashed hopes for an early settlement of the negotiations over Hyundai Electronics' acquisition of LG Semicon, analysts said. Hyundai failed to make official comments, but may find most of the LG demands hard to swallow, the analysts forecast. Kang Yu-sig, president of LG's executive office for corporate restructuring, told a news conference that a guarantee to rehire all LG Semicon employees for up to seven years will be the foremost issue in the merger talks. "Unless LG's demand for the employment guarantees is not accepted, an extreme measure will not be ruled out," he warned. He refused to elaborate on the extreme measure, but analysts speculated it may mean a collapse of the talks. "Talks on the sale price will begin only after the employment issue is settled," Kang stressed. Shortly after LG Group Chairman Koo Bon-moo agreed to hand over full control of LG Semicon Jan. 6, Hyundai Group Chairman Chung Mong-hun promised to accept all LG Semicon workers. Yet LG officials raised fears that rehired LG workers will be subjected to various disadvantages and layoffs, shortly after the merger is completed. In yet another shadow on the merger talks, meanwhile, the two groups continued to show sharp gaps in asset valuation. Besides an estimated 1.3 trillion won ($1.1 billion) for its 60-percent stake in LG Semicon, LG was expected to demand about $3.1 billion to claim 50 percent of the merger's synergic effects over the next five years. But LG further stepped up the demand yesterday, with Kang saying that synergies over the next 20 years must be calculated in the sale price. "It is Hyundai that first estimated the merger's synergies at $6.2 billion," said Kang. Earlier, Hyundai said that it will not pay a single penny to redeem LG the synergies. In a similar context, Kang rejected an alleged Hyundai proposal to settle some of LG Semicon sales in convertible bonds. On the other hand, the Samsung and Daewoo groups have lately achieved some progresses in their bid to solve key disputes in their auto-electronics swap negotiations, according to industry sources.