New York Times, April 22, 2000
Renault Agrees to Buy Troubled Samsung Motors
By JOHN TAGLIABUE
PARIS, April 21 -- Renault, the French automaker, reached an agreement
today to acquire the ailing Samsung Motors of South Korea, concluding its
second major acquisition in Asia in the last year.
Renault, which last year acquired 37 percent of Nissan, the troubled
Japanese carmaker, said last month that it hoped the takeover of Samsung
Motors would enable it to challenge Hyundai, the market leader in South
Korea, by securing 10 percent to 15 percent of the nation's automobile
market.
Financial details of the Samsung acquisition were not announced, but
Renault is believed to have agreed to pay $340 million to $350 million.
Renault is expected to pay about $100 million immediately, and the rest
over 10 years. Renault will also assume about $200 million in Samsung debt.
The acquisition agreement was reached after four months of negotiations
when Samsung's South Korean creditors, led by Hanvit Bank, agreed to settle
$262 million in debt that the French carmaker had discovered.
The deal represents the latest entry by a Western carmaker into the Asian
market, which was shaken badly by the region's economic crisis in 1998.
Last month, DaimlerChrysler agreed to pay $2.1 billion for a 33 percent
stake in Mitsubishi Motors. The last two years, seven of Japan's 11
carmakers have linked up in various degrees with foreign partners. Another
South Korean carmaker, Daewoo, is up for sale, and Western carmakers,
including General Motors, Ford Motor, DaimlerChrysler and Fiat of Italy,
are bidding for control.
Full article at:
http://www.nytimes.com/yr/mo/day/news/financial/renault-samsung.html
Louis Proyect
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