Turning Point
On August 28, Minister of Trade, Industry & Energy Baek Woon-kyu expressed his objection to Korea Development Bank’s plan to sell Kumho Tire to a foreign company.
“The Defense Acquisition Program Administration recently asked my ministry to respect the Technology Leakage Prevention Committee’s decision with regard to the approval of the sale of Kumho Tire,” the minister said at the National Assembly, adding, “It is a matter to be determined after its impact on industries is examined from various aspects.”
In response to The Minjoo Party lawmaker Kwon Chil-seung’s question, the minister said various factors should be considered before it is determined whether the sale of Kumho Tire is the best option. According to industry insiders, this implies that the ministry will be opposed to the sale of the company, which is a defense contractor, as the organization responsible for the prior approval.
Multiple lawmakers raised an objection to the sale, too. They criticized the bank as well, saying that the bank is a state-run organization that should serve to protect South Korea’s national interests without being governed by the principles of market economy.
Kumho Tire creditors, in the meantime, are feeling embarrassed by the minister’s remarks as it means the South Korean government’s opposition to the acquisition of Kumho Tire by Doublestar Tire, the preferred bidder. “The Chinese government is likely to resist once the sale fails,” one of them mentioned.