Hurdles to Selling-off
The sale of Daewoo E&C whose stock price has plunged every day is being delayed as its labor union went on a strike.
A recent drop in the company’s stock price further has been fouling up the sale of Daewoo E&C expected to be sold off to a new owner soon. On December 27, its stock price closed at 5,850 won (US$5.2), down to about one third of the price (15,000 won or US13.5) when the Korea Development Bank purchased Daewoo E&C stocks.
Daewoo E&C's stock price topped 7,000 won (US$6.3) on September 20 when Lee Dong-gul, chairman and chief executive officer of the KDB said, “We will sell off Daewoo E&C stocks even if we suffer loss,” in a press conference in honor of his inauguration as chairman or on October 13 when the bank put out an announcement to sell the stocks. Since then, however, the stock price has gone downhill, failing to rebound. This is why some observers say that the bank has no choice but to put off the sale of Daewoo E&C. The KDB is officially holding fast to its policy of selling off the stocks.
However, the labor union began to take issue with the sale process, giving rise to more uncertainties. On December 21, the union began a labor strife, saying, “The KDB is moving forward with the sell-off of Daewoo E&C stocks helter-skelter” on the heels of the breakdown of wage negotiations. In addition, the union filed a criminal complaint against Park Chang-min who resigned as president of Daewoo after an allegation that Park was appointed as president on Choi Seon-sil's coattail and another Lee Dong-gul, former chairman of the KDB who has the same name as the current chairman of the KDB with the police on the charge of interference in work.
This labor strike marked the first one since a unified labor union was born at Daewoo E&C in 2000.