Ad Quem of Long Journey
The sell-off of Kumho Tires actually broke up after controversies. On September 5, the Kumho Tire creditors, including the Korea Development Bank (KDB), held a shareholders' meeting and decided not to accept a demand to cut the sale price from China’s Doublestar.
Doublestar demanded a change in the stock purchase contract (SPA), saying that it was inevitable to lower Kumho Tire’s selling price 16.2% from 955.0 billion won to 800.0 billion won as Kumho Tires' earnings were lower than expected. However, the creditors did not accept the Doublestar's demand, taking steps to terminate the SPA which the KDB and Doublestar signed in March. At the same time, the sell-off of the tire manufacturer led by the KDB for more than one year will also go back to square one.
"We negotiated with Doublestar side about a price cut a number of times, but failed to iron out differences and brought the termination of the SPA as an agenda for a shareholder meeting," said an official of the creditors.
The KDB will deprive Kumho Asiana Group chairman Park Sang-gu of the management right such as by recommending chairman Park to step down as president of Kumho Tire. "The action seems to be a measure to hold chairman Park accountable for delaying the sale work," said an official of the financial industry in reference to this plan of the KDB.
The failure of the sale of Kumho Tire is expected to compel chairman Park, who led a dramatic reversal while having a head-on collision with the KDB, to wait for a change once again while buying time.
However, it is expected that the variables will remain, such as the bad blood between the KDB and chairman Park that took place during the sales negotiation process, the question on whether or not chairman Park will be stripped of the management right to Kumho Tire and the issue of whether or not chairman Park will raise funds among others. Some experts criticize that the KDB’s unreasonable attempt to sell off Kumho Tire produced negative aftereffects such as damage to Kumho Tire’s sales channels and performances only.