Differences remain as due diligence on GM Korea begins

Latest news

    SEOUL, March 12 (UPI) — Unresolved differences remain as General Motors Korea and its second largest shareholder Korea Development Bank as due diligence on the company begins this week.

    According to South Korea’s trade ministry, KDB launched the long-due review on Monday morning with a meeting at GM’s Bupyeong plant, west of Seoul, News 1 reported.

    The U.S. automaker last month announced its decision to scrap its Gunsan plant and decide on the fate of its remaining factories in the country, claiming that local operations have been unproductive.

    The ailing company has requested government subsidies through KDB and tax benefits in return for a debt-to-equity swap on loans from GM headquarters and the allocation of new cars to South Korean plants.

    With thousands of jobs at stake, local authorities have requested due diligence to examine why the company fell into the red before deciding on state support to keep operations up and running.

    GM Korea is believed to have provided its locally manufactured cars to GM outlets worldwide at excessively low prices as well as paying higher-than-average interest on loans from its parent company.

    KDB aims to look into the suspicions as well as costs for management, technology and labor.

    However, the format and the period of due diligence still haven’t been determined. The review was delayed for about three weeks, as GM did not submit documents requested by the bank.

    According to Yonhap, KDB Chairman Lee Dong-gull told reporters, “There were differences between the KDB and GM over the conditions involving due diligence, but they reached an overall agreement on various aspects.”

    Bank officials say the U.S. company is still showing reluctance on disclosing vital information, with GM International’s President Barry Engles complaining last week that the due diligence is too strict, Maeil Business Daily reported.

    It appears GM wishes to wrap up the review within a month, while KDB is pushing for a thorough audit of the company’s management, citing its lack of transparency over the years.

    View the original article: https://www.upi.com/Top_News/World-News/2018/03/12/Differences-remain-as-due-diligence-on-GM-Korea-begins/4091520836682/

    Meanwhile, GM Korea on Monday requested the governments of South Gyeongsang Province and Incheon City to designate its factory sites as foreign investment zones, making it eligible for seven years of tax benefits.

    https://www.upi.com/Top_News/World-News/2018/03/12/Differences-remain-as-due-diligence-on-GM-Korea-begins/4091520836682/ to see original story and photos

    In the same category are

    Delaware Lottery player uses $10 prize to buy $50,000 winning ticket June 19 (UPI) -- A Delaware woman who won $10 from a scratch-off lottery ticket parlayed her winnings into a $50,000 jackpot by buying another ticket...
    UPI Horse Racing Roundup: Pavel, Blue Prize and Oscar Performance shine Pavel took a step forward with a win in the Stephen Foster, Blue Prize took the Fleur de Lis at Churchill Downs and Oscar Performance gave a performa...
    Ted Cruz beats Jimmy Kimmel in charity basketball game June 17 (UPI) -- U.S. Sen. Ted Cruz beat talk-show host Jimmy Kimmel 11-9 at the first Blobfish Basketball Classic at Texas Southern University's Hea...
    Kansas parents face $132,000 bill after son breaks statue June 16 (UPI) -- Kansas parents may have to pick up a $132,000 tab after their son toppled a statue. Surveillance video shows a boy hugging the sculp...
    Walgreens to move 1,800 jobs to new Chicago office June 15 (UPI) -- Walgreens announced Friday it will move 1,800 jobs to a new office in Chicago, the where the chain was originally founded in 1901. I...
    World Cup: Cheryshev uses first touch, scores for Russia June 14 (UPI) -- Forward Denis Cheryshev scored after a first touch during Russia's World Cup opener against Saudi Arabia Thursday in Moscow. Cherysh...

    Leave a comment

    Your email address will not be published. Required fields are marked *

    This site uses Akismet to reduce spam. Learn how your comment data is processed.