Hyundai wins, Ford loses in Kia takeover

Hyundai wins, Ford loses in Kia takeover

SEOUL (Reuters): South Korea's Hyundai Motor Co Ltd was
awarded the bid to take over troubled Kia Motors Corp and sister
firm Asia Motors, the chief of the auction panel said on Monday.

Ford Motor, a major Kia shareholder, was disqualified after it
offered a bid price for Asia Motors which was below the face
value of 5,000 won ($3.74), Lee Jong-dae, president of the chief
administration office of Kia Motors, told reporters.

The auctioning secretariat had said the bidding price per
share should not be lower than the face value of 5,000 won.

Local newspapers reported on Monday Ford had wanted to take
over Asia at 1,000 per share.

Unlisted Daewoo Motor Co was the runner-up in the auction,
which also included a bid by unlisted Samsung Motors Inc, Lee
said, adding that Samsung received the lowest number of points in
the evaluation.

"Hyundai received the highest number of points in its demand
for writing off the two automakers' debts and for its conditions
in other areas," Lee said.

He declined to reveal how much of the two automakers' debts,
estimated by some at 12 trillion won, Hyundai had asked to be
written off but said the figure was "substantial."

Hyundai Motor Chairman Chung Mong-kyu would make a statement
on its Kia bid at 0500 GMT, a Hyundai spokesman said.

State-run Yonhap News Agency last week quoted an unidentified
creditor as saying creditors would refuse to choose a bid that
asked for debt cuts above 6.0 trillion won.

The news agency said that meant Hyundai or Daewoo would win,
because Samsung and Ford had asked for at least 7.0 trillion won
in write-offs.

The government, which virtually nationalized the carmakers
when state-owned Korean Development Bank became its largest
shareholder last year, had indicated it preferred a takeover by
Ford, which along with Japanese affiliate Mazda owns 16.9 percent
of Kia.

Two earlier attempts to auction off the automakers failed
after creditors refused to go along with bidders' demands for a
write-down of the companies' debts.

Monday's bid decision needs to be approved by creditors before
it becomes final.

After the bid winner was announced, Yonhap Television quoted
Commerce Minister Park Tae-young as saying Kia and Asia would be
forced into bankruptcy if creditors refused to approve the bid
selection.

Confirmation of Park's statement was not immediately
available.