South Korea

Mahindra & Mahindra Ltd. said Monday it will start due diligence on Ssangyong Motor Co. in the next few days so it can decide on submitting a final bid for South Korea's fourth-largest car maker by sales, Dow Jones Daily Bankruptcy Review reported. Mahindra, India's biggest sport-utility vehicle maker by sales, is among six companies worldwide who qualified earlier this month to conduct due diligence on cash-strapped Ssangyong before submitting their binding bids.

Seven companies have joined the race to acquire Ssangyong Motor Co. by submitting separate letters of intent to deal adviser Macquarie Securities Korea, cash-strapped Ssangyong Motor said Friday, Dow Jones Daily Bankruptcy Review reported. Ssangyong Motor didn't name the seven companies, citing a confidentiality agreement. Local media earlier Friday reported that two Indian companies - Mahindra & Mahindra Ltd. and Ruia Group - as well as three Korean companies: Renault Samsung Motors Corp., Young An Hat Co. and Seoul Invest are interested in bidding for Ssangyong Motor.

Creditors of Daewoo Motor Sales Corp. Tuesday stepped in to keep the vehicle sales and real estate development company afloat reversing an earlier decision to let it go bankrupt after failing to pay back maturing debts, but the decision appears to be a stopgap measure, Dow Jones Daily Bankruptcy Review reported. Tuesday morning creditors paid a combined KRW26.8 billion ($24 million) that was due on Friday and Monday, giving Daewoo Motor Sales a lifeline, main creditor Korea Development Bank said. "But we cannot guarantee payment of additional debts that mature from May.

Creditors of Daewoo Motor Sales Corp. have decided to let the vehicle sales and real estate development company go bankrupt, the main creditor, Korea Development Bank, said Monday. "The debt-rescheduling program for Daewoo Motor Sales may run aground due to the creditors' bankruptcy decision," a KDB official told Dow Jones. The company may be placed under a court receivership, said the official, who asked not to be identified. Daewoo Motor Sales said if it comes under the court protection, it is "the worst-case scenario" they can imagine.

Unionized workers at Kumho Tire Co. have accepted the company's restructuring measures, including a reduction in wages and bonuses, in the second round of a vote held Wednesday, the company said Thursday, Dow Jones Daily Bankruptcy Review reported. Under the agreement, Kumho Tire workers will have to accept a 10% basic salary cut for 2010 and an additional 5% cut before the company's exit from a debt-rescheduling program, which may take two to three years. The company withdrew its original plan to cut about 1,200 workers in return for union concessions on wages.

Swedish network equipment vendor L.M. Ericsson Telephone Co. has purchased Nortel Networks Corp.'s controlling stake in a South Korean joint venture for $242 million in cash, a move that should help boost its footprint in the Asian country, Dow Jones Daily Bankruptcy Review reported. Ericsson said Wednesday that it has bought Nortel's 50% plus one share stake in its joint venture with LG Electronics Inc., LG-Nortel. LG-Nortel will be renamed LG-Ericsson and will continue to have its headquarters in Seoul.

Shares of Kumho Industrial Co. will resume trading on the Seoul bourse Tuesday after a one day suspension amid market rumors that the financially embattled company may file for bankruptcy protection, the bourse operator said Monday, the Yonhap News Agency reported. "(Kumho Industrial) has not yet looked into applying for court management," the company said in a regulatory filing. The Korea Exchange called for the construction unit of Kumho Asiana Group to respond to the market speculation by 6:00 p.m. Monday, suspending its share trading before the stock market opened at 9:00 a.m.

China's pullback from stimulus efforts, which were geared toward grappling with the financial distress, is likely to affect Korea in deciding when to employ its own exit strategy, The Korea Times reported. China, Korea's largest trading partner, began to withdraw its expansionary policies this week with its central bank raising lenders' reserve requirement ratio by 50 basis points.

Troubled Ssangyong Motor avoided bankruptcy after a court approved its self-rescue plan despite opposition from overseas creditors. The ruling enables the cash-strapped automaker to get additional financing from investors, and take a series of steps to eventually stand on its own feet. Its ongoing negotiations for a possible sale is also expected to gain momentum. A Ssangyong spokesman told The Korea Times that it would select a candidate to take over the company by January and complete the deal by September.

GM Daewoo, which accounts for about a quarter of GM's global auto production, also represents one of the few remaining areas needing restructuring after the U.S. automaker exited bankruptcy in July with $50 billion in U.S. government funding. GM Chief Executive Fritz Henderson is in Seoul this week to discuss options for restructuring GM Daewoo with the South Korean government -- an increasingly important asset for the automaker.