Media outlets in India are again saying that appliance OEM Videocon (Mumbai, India) will buy Korean appliance maker Daewoo Electronics, and soon.
It may be speculation, as creditors in Korea have yet to make an official announcement about who came out on top in bidding for the Daewoo appliance business. The same news outlets claimed in March that Videocon had reached a U.S. $113 million deal to buy Daewoo, only to see bidding on Daewoo open up and attract 19 potential bidders. The deal is now reported at $400 million or more.
In early June, Daewoo Electronics creditors pared down the list of 19 bidders to five companies. The list of original bidders and the companies on the shortlist were never officially released. Among the companies said to be bidding were Videocon Industries Ltd., as well as Whirlpool Corporation (Benton Harbor, Michigan, U.S.) and Turkish appliance and consumer electronics OEM Vestel Elektronik Sanayi Ve Ticaret A.S.
Videocon certainly would be a likely buyer. The company has ambitious growth goals and has made two substantial acquisitions in the last 2 years: it bought the Electrolux appliance business in India and acquired Thomson's cathode ray tube (CRT) facilities in China, Mexico, and Poland.
Background on Daewoo's Appliance Business
As APPLIANCE reported on July 21, 2005, the state-run Korea Asset Management Corp. (KAMCO) is eager to sell Daewoo Electronics. The troubled home appliances maker has been in a debt workout program since parent Daewoo Group collapsed under debts of nearly U.S. $80 billion in 1999. KAMCO is a state asset management company and a major shareholder in Daewoo Electronics, once one of Korea's top home appliance makers. Woori Bank, South Korea's second-largest lender, is handling the sale procedure. They have stated their intention to make the sale by September 2006.
Daewoo has five appliance-producing plants in Korea and has plants in the U.S., the United Kingdom, Spain, Poland, Mexico, China, Vietnam, and Malaysia.
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