Tata Motors signs MoU to buy Daewoo's truck division

By siliconindia staff writer   |   Thursday, 06 November 2003, 20:30 IST
Printer Print Email Email
MUMBAI: Tata group on Wednesday said it had signed a memorandum of understanding (MoU) to acquire South Korean truck maker Daewoo Commercial Vehicle Co Ltd. Daewoo Commercial last month named the Tata group as the preferred bidder for the truck maker, which is under court receivership. "The transaction is expected to close in the next two to three months subject to a final due diligence of Daewoo Commercial's operations, the negotiation of future agreements and receipt of applicable regulatory approvals in India and Korea," Tata Motors, the Tata group's automobile company, which signed the MoU in Seoul, said in a statement. Tata Motors spokesman V Krishnan said the MoU was the first step towards acquiring Daewoo's truck business. CNBC India, quoting a Daewoo statement, said the acquisition was estimated to be worth more than $100 million. KPMG, a lead manager of the sale of the Daewoo truck maker, selected Tata as preferred bidder from some 10 international firms interested in the former unit of bankrupt Daewoo Motor Co. Daewoo Commercial Vehicle, which produces trucks of eight or more tonnes, posted 120 billion won ($100 million) in sales last year, with 2003 sales estimated at 200 billion won. It was spun off from bankrupt Daewoo Motor, once South Korea's second largest auto manufacturer, in November 2002. Tata Motors, formerly known as Tata Engineering or TELCO, is India's leading commercial vehicle manufacturer and also is one of the largest car makers.