Deal involving Videocon is valued at $700 m
SEOUL: Videocon on Monday said a consortium led by it had reached an agreement to acquire South Korea's debt-burdened Daewoo Electronics for $700 million (Rs. 3,150 crore). The agreement was signed on October 20 by a consortium led by Videocon and creditors of the troubled South Korean firm, which was earlier part of the Daewoo group that wound up in 1999 after running up a debt of about $80 billion.
"Videocon-led consortium (has) entered into an agreement for acquiring Daewoo (Electronics) at $700 million,'' a company official confirmed to PTI. Videocon and the U.S.-based equity fund Ripplewood had jointly bid for Daewoo Electronics, after it was put on the block by its lenders.
In a separate statement, the Creditor Financial Institutions Committee for Daewoo Electronics said: "The consortium was selected... as an exclusive negotiation partner based on various factors including financial capacity, complementarity of businesses, track record in various acquisitions, including commitment toward ongoing investments...''
The deal will mark Videocon's third purchase in the last one year after Thompson's global picture tube business for 240 million euros (Rs. 1,260 crore) and loss making Indian subsidiary of AB Electrolux, Sweden.
The completion of the transaction is subject to various formalities and approvals. PTI