Park given more time for his Kumho Tire plan

The main creditor of Kumho Tire, the second-largest tire company in Korea, ordered Kumho Asiana Group Chairman Park Sam-koo to submit a final plan to buy back the company by April 19.

“Submit the plans that will explain how you will come up with the funds to acquire the company and whether you will exercise your right of first refusal by the deadline,” state-run Korea Development Bank told Park on Wednesday.

On the previous day, the creditors jointly rejected Park’s request to create a consortium to buy the company without a more detailed plan, which he was told to submit by April 13. The deadline was extended on Wednesday.

The creditors first set the deadline at April 13 because it was 30 days after they notified Park of an agreement they signed with Chinese tire company Doublestar to buy Kumho Tire. Park argued that he didn’t receive the official document until March 20. So the deadline was extended to April 19.

“We can’t understand the KDB’s decision and we find it useless to even take a look at it,” said Kumho Asiana in a press release after the creditors’ announcement Tuesday. It threatened to bring the case to court.

KDB, which owns a 32.2 percent stake in the tire company, signed an agreement with Doublestar in January to sell a 42.01 percent stake including shares held by others for 955 billion won ($856.5 million).

But Park has the right of first refusal to buy the company, which means that he can buy it back if he comes up with 1 won more than the Doublestar offer.

Park says he should be given the same chance as his Chinese competitor. The KDB has been saying that the right of first refusal belongs to Park alone, not any consortium he forms.

Kumho publicly asked the KDB Wednesday whether the “reconsideration” means that the creditors will allow Park to form a consortium.

Presidential candidates are pressuring the KDB to make a careful decision because of the impact it can have on the local labor market.

Korean presidential candidates including front runner Moon Jae-in and Ahn Cheol-soo have publicly said that the KDB should be cautious in making its decision.

The tire company has plants in Gwangju and Gokseong, South Jeolla, where liberal parties have a lot of support. Both Moon and Ahn are liberal candidates.

BY KIM YOUNG-NAM [kim.youngnam@joongang.co.kr]