South Korea has apparently held a meeting with regards to its due diligence of General Motor’s South Korean unit business unit. The Korea Development Bank, which has a 17% share in the General Motors Korea Company, has announced that it will cooperate with the due diligence procedure of General Motors.
As per reliable sources, a meeting was held between GM executive VP Barry Engle, Korea Development Bank (KDB) Chairman and Chief Executive Lee Dong-gull. The outcome stated that the bank will transparently look into the due diligence process on GM Korea this week. Engle has requested KDB to invest nearly USD 2.8 billion in GM Korea. Incidentally, 77% of this company is owned by GM, 6% is owned by SAIC, while the rest is contributed by KDB, to stabilize its business in Korea.
Earlier last month, the automobile giant had stated its intentions of closing down one of its four vehicle production facilities in South Korea, with the pending decision on the remaining three of its establishments depending on government funding & wage reductions by trade or worker unions. For the record, in February this year, the firm had asked its 16,000 employees to work for reduced payments without demanding any bonus in 2018. Reports have speculated that the firm and the trade unions will be having a meeting within a few days over the terms of proposed salaries offered by GM Korea.
As per reliable sources, nearly 2,500 personnel of GM Korea have submitted their application for redundancy payment & entitlements, which the U.S. based automobile manufacturer is offering as a part of its restructuring activity. In 2017, the revenue of GM Korea dipped by 12% y-o-y basis with four production facilities of the firm within the country manufacturing over 5 lac vehicles, which was lesser than its actual target of over 9 lac units.