China’s Qingdao Doublestar Co. has signed an agreement with South Korean tyre maker Kumho Tire creditors to buy a 42% stake worth US$830 million.
With this deal, Doublestar could become China’s largest tyre maker and in the running as the top ten global tyre makers.
Meanwhile Kumho Tires’s Chairman Park Sam Koo is still bidding for the company, and putting together a consortium of investors to buy back the stake.
Park is in talks with several strategic investors including a Chinese company, said Kumho Asiana.
Park has a month to make a decision after getting the related notice from the creditors and has to offer more than Qingdao Doulestar’s bidding price to take the affiliate back.
Meanwhile, Korea Development Bank, one of the creditors leading the stake sale, said that the takeover should not be made through a consortium.
Kumho Asiana Group put Kumho Tire and Kumho Industrial Co. under a debt restructuring plan in December 2009. Creditors including state-owned Korea Development Bank and Woori Bank reached an agreement to convert debt to equity in 2010 and hold a total of 42% of shares in Kumho Tire.