Videocon, Daewoo deal might not see daylight

By SiliconIndia   |   Wednesday, 27 December 2006, 06:00 Hrs
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Mumbai: Videocon Industries may be looking to get a discount for acquiring Daewoo Electronics, South Korea's sick company.

Sources have brought to notice that the Videocon-led consortium has sought a 13 percent discount on the agreed price of about Rs 3,200 crore for the buyout, negotiated in October. The proposed sum for the purchase of the creditors' share in Daewoo was about Korean won 700 billion (about $730 million).

Chairman of Videocon Industries, Venugopal Dhoot and Daewoo's creditors declined to confirm the circumstances.

The creditors of Daewoo are looking to disburse the sale; even putting an end to any further price talks reports a foreign news agency. These creditors are selling their 97.6 percent stake in the Korean electronics firm.

A foreign news agency, quoted an official of Woori Bank, one of the Daewoo's creditors, saying, "There are some conditions attached to Videocon's final offer and we are reviewing them." The deal is to be finalized by the end of this year as planned, the official informed.

Videocon Industries Ltd, with its consortium partner Belgium-based holding company RHJ International, signed a MoU with the creditors of Daewoo, including Woori Bank and Korea Asset Management Corp. The creditors seek to sell their controlling stake in the Korean company since November 2005, after it came under a debt-restructuring program.

The acquisition of Daewoo, will be Videocon's third major acquisition in the last one year. It has earlier taken over Thompson's global picture tube business for about Rs 1,260 crore and Electrolux Kelvinator India, the Indian subsidiary of A.B. Electrolux of Sweden.

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