May 4, 2011 | Quote

Daewoo Takeover by Iranian Firm in Doubt

The agreed US$513 million takeover of South Korea’s Daewoo Electronics by Iran’s Entekhab Industrial Group is at the risk of collapse as the buyer continues to fail to meet extended deadline to file acquisition funding plans, a leading shareholder said on Tuesday 3 May 2011.

An official at Woori Bank, which represents creditors-turned shareholders of the unlisted Korean firm, said they were now aiming to close the deal by the end of this month, but declined to comment whether they will start talks with reserved bidder, should the deal falter.

The unlisted Iranian appliance maker was named preferred bidder for Daewoo in 2010, beating out rival bidder Swedish electronics firm Electrolux, but it has repeatedly failed to satisfy creditor demands for detailed funding plan, resulting in several months of delay in the final agreement than it had initially planned. It was the fourth attempt for the creditors to sell Daewoo, which makes primarily on washing machines and refrigerators.