Alexa

South Korea's Kumho may seek debt workout for troubled units

South Korea's Kumho may seek debt workout for troubled units

South Korea's eighth largest group Kumho Asiana said yesterday it would consider placing some troubled units under a debt workout program amid market jitters about its financial health.
"There were negotiations with creditors on placing our troubled units under a debt workout program, but nothing has been decided," a group spokesman told reporters.
He declined to confirm news reports that creditors would put as least two units - Kumho Industrial, the group's building unit, and Kumho Tire - under the program.
The group's debt is now estimated at 18 trillion won (US$15.4 billion) compared with assets worth about 38 trillion won.
Kumho Asiana, parent of the country's second flag carrier Asiana Airlines, acquired Daewoo Engineering and Construction for 6.43 trillion won in 2006 and top logistics company Korea Express for 4.1 trillion won last year.
The acquisitions helped it become the nation's eighth-biggest business group but sparked concerns about its reckless expansion.
The spokesman said the global economic crisis aggravated the group's financial woes and delayed its attempt to sell off Daewoo, a major builder bailed out in the wake of the 1997-98 East Asian financial crisis.
The group had borrowed 3.5 trillion won to finance the acquisition of Daewoo by offering 39.6 percent of Daewoo shares as collateral.


Updated : 2021-04-11 11:26 GMT+08:00