Iranian firm set to buy Daewoo Electronics

Creditors in negotiations with Entekhab Industrial Group; decision expected next week

Tags: Daewoo International Corporation ( and acquisitionsSouth Korea
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Iranian firm set to buy Daewoo Electronics A final decision will be made after negotiations between Daewoo's creditors and Entekhab take place next week. (Getty Images)
By  Vineetha Menon Published  August 29, 2010

Creditors of Daewoo Electronics are set to sell the South Korean electronics firm to Iranian home appliance maker Entekhab Industrial Group.

According to a report by FARS news agency, Daewoo's creditors including Woori Bank, chose Iran's Entekhab Industrial Group as the preferred bidder for their 97.5% stake in Daewoo in April. Now, a final decision will be made after negotiations on the sale price at a meeting to be held next week.

The sale price is estimated to be at a range of 470 billion won ($395.7 million) to 520 billion won, lower than the 605 billion won ($508 million) Entekhab had originally offered to pay.

"Majority creditors are expected to agree on the sale plan even though the sale price is lower than before," a creditor bank official said. "The sale of Daewoo Electronics sale has been delayed so long and there is no guarantee that we can receive higher prices from other prospective buyers."

Daewoo Electronics, a former subsidiary of the Daewoo Group which collapsed during the Asian financial crisis, was put under a debt workout program in January 2000.

Creditors' previous attempts to sell the company in 2006 and 2008 weren't successful due to disputes over the bidding price.

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