As a result of the deal, planned investments will help stabilize the company, upgrading and expanding manufacturing, R&D and reach of the global tire brand.
In Korea, the Kumho Tire labor union has decided to finally hold a vote on whether to accept the acquisition bid by the Chinese tiremaker.
A South Korean company has expressed interested in buying the debt-ridden Kumho Tire Co. just days before its deadline to finalize a deal with a Chinese tiremaker.
As a Friday deadline is on the horizon to accept a reorganization plan, Kumho’s labor union continues to resist Doublestar’s acquisition.
The head of Chinese tiremaker Qingdao Doublestar, who recently acquired Kumho Tire Co., paid a visit to the South Korean company, calling the investment a “win-win” partnership and pushing for a deal with Kumho’s worker’s union.
The sit-ins and walk-outs by unionized Kumho Tire workers have ended; however, the union group continues efforts to block the sale of the tiremaker to Chinese tiremaker Qingdao Doublestar.
China’s Qingdao Doublestar Co. Ltd. has agreed to invest 646.3 billion won ($597.4 million USD) for a 45% stake in South Korea’s Kumho Tire Co. Inc, multiple news outlets reported at the beginning of March.
The main creditor of Kumho Tire, Korea Development Bank (KDB), is again in negotiation with China’s Qingdao Doublestar, but additional variables in play may pose serious challenges to any new deals.
After a year of negotiation regarding the acquisition of Kumho Tire by Qingdao Doublestar, the deal could be back at square one.
The sale of Kumho Tire to Chinese tiremaker Qingdao Doublestar Co. could go back to the drawing board, potentially opening an opportunity for Park Sam-koo, chairman of Kumho Asiana Group, to exercise his buyback rights after all.
Qingdao Doublestar Co. is in its final stages of the majority share purchase of Kumho Tire Co., according to Korean media.
Forty-one Kumho Tire executives, including CEO Lee Han-seob, have threatened to resign if the tiremaker is sold to Doublestar.