Videocon along with US-based private equity firm Ripplewood have proposed a price cut of up to 13% on the $730 mn acquisition of Daewoo Electronics after conducting due diligence of Daewoo. This has not gone down well with the creditors of Daewoo who are collectively running the company since the Daewoo conglomerate collapsed under $80 mn debt in 1999.
The creditors, led by Woori Bank, are going to come to a decision regarding the price cut in the first week of January 2007. Unless more than 75% of the creditors agree to the proposal, the deal would be cancelled. In case creditors did not agree to the price cut, the process for sale of the ailing company would have to start afresh. Videocon officials refused to comment on the issue.
Read The Financial Express article.
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