GM proposes to convert US $2.2 bil. debt for equity, in exchange for financial support to stay in Korea
- 6 years ago
We begin this morning with the economic and political fallout from General Motors' decision to essentially up sticks from Korea.
Sources with direct knowledge of the matter say GM has offered a deal to the South Korean government in exchange for financial support and tax benefits from Seoul.
Park Soyun reports.
GM has proposed to the South Korean government, a two-point-two billion dollar debt-to-equity swap for GM Korea in exchange for government support worth up to one billion U.S. dollars.
With that,... came another offer: the U.S. automaker will invest to develop new models in Korea as part of its plan to fix its problems here.
Following a meeting with a task force headed by Korea's ruling party on Tuesday,... the president of GM's international operations said the new models would be produced at three GM Korea factories around the country,... and GM would eventually look to produce 500-thousand cars annually.
The offers have been made,... but nothing has been decided,... with South Korean government officials saying it's too early to push for any financial backing,... as it wants to conduct due diligence before committing to any support.
The restructuring proposal comes just a week after GM announced it would shut down one of its plants in the western port city of Gunsan by May and consider whether to continue operations at its three other plants in Korea.
At the same time,... GM's call for financial support from the Korean government is raising some eyebrows,... as the company recently announced plans to invest 265 million dollars in its Kansas plant.
Critics say it's a sign GM is falling in line with President Trump's policy of putting America and American workers first,... especially as Seoul and Washington are locked in high-stakes negotiations over a possible amendment of their bilateral free trade agreement.
However,... GM insists the ongoing FTA talks have not shaped any of their plans or announcements.
Park Soyun, Arirang News.
Sources with direct knowledge of the matter say GM has offered a deal to the South Korean government in exchange for financial support and tax benefits from Seoul.
Park Soyun reports.
GM has proposed to the South Korean government, a two-point-two billion dollar debt-to-equity swap for GM Korea in exchange for government support worth up to one billion U.S. dollars.
With that,... came another offer: the U.S. automaker will invest to develop new models in Korea as part of its plan to fix its problems here.
Following a meeting with a task force headed by Korea's ruling party on Tuesday,... the president of GM's international operations said the new models would be produced at three GM Korea factories around the country,... and GM would eventually look to produce 500-thousand cars annually.
The offers have been made,... but nothing has been decided,... with South Korean government officials saying it's too early to push for any financial backing,... as it wants to conduct due diligence before committing to any support.
The restructuring proposal comes just a week after GM announced it would shut down one of its plants in the western port city of Gunsan by May and consider whether to continue operations at its three other plants in Korea.
At the same time,... GM's call for financial support from the Korean government is raising some eyebrows,... as the company recently announced plans to invest 265 million dollars in its Kansas plant.
Critics say it's a sign GM is falling in line with President Trump's policy of putting America and American workers first,... especially as Seoul and Washington are locked in high-stakes negotiations over a possible amendment of their bilateral free trade agreement.
However,... GM insists the ongoing FTA talks have not shaped any of their plans or announcements.
Park Soyun, Arirang News.