Creditors for Kumho Tire have decided to postpone discussing the debt-ridden company’s fate until the end of the month, according to The Korea Herald.
The delay allows the company to avoid being put into a court receivership. The Korea Herald reported that creditors held a meeting on Wednesday and decided to postpone adjusting the tiremaker’s debt repayment schedule to the end of March. They also did not accept the company’s self-rescue plan for business normalization.
The creditor, the Korea Development Bank, said it will work to persuade the labor union and attract external capital to save the company that has a 1.3 trillion won ($1.2 billion) debt it can’t afford to pay.
The fate of Kumho become uncertain when a deal with China’s Qingdao Doublestar to buy the company crumbled last September.
Since then, Kumho’s labor union has demanded that creditors and the management not sell to a foreign buyer unless they are involved, according to Korea Business.