The Hindu Business Line : `Videocon bid for Daewoo Elect falls through'

Mumbai May 18 Videocon Industries remained tight-lipped over reports that its $750-million bid for Daewoo Electronics of South Korea has fallen through on pricing considerations.

Media reports from Seoul quoting sources from Daewoo creditors said that the deal by a consortium lead by Videocon had collapsed on disagreement over price and payment issues. Korea Asset Management Company, Daewoo's biggest creditor, and Woori Bank, which had led the sale were reported to have rejected Videocon's latest and revised offer of early May, the media-report said. When contacted by Business Line, Videocon officials were unwilling to comment on the development.

However, this is not the first time that the two have fallen out over price discounts reportedly sought by Videocon. Negotiations have come unstuck twice over in the past, late last year and earlier this year.

The creditors are working on beefing up Daewoo's health, by focusing on restructuring the company and getting it to post profits to attract other prospective buyers. The report indicated that Videocon could get back into the race for the South Korean electronics company.

Videocon, in partnership with a fund headed by Ripplewood Holdings, had initially bid for the company.

A Memorandum of Understanding had been signed in October 2006 between the Videocon-consortium and creditors of Daewoo, including Woori Bank and Korea Asset Management Corp.

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