Daewoo Craiova sale likely by September 2007

11 July, 2007


With Ford Motor Corp being the only auto maker who had submitted a bid for a majority stake in Daewoo Automobile Craiova, Romania is planning to
wrap up the sale of Daewoo Craiova by September 1, 2007.

Reports quoting privatization officials of Romania that the privatizations process would hopefully be completed by September 1, 2007. The car maker's sale committee, which did not open Ford's financial bid, said all required documents have been submitted and that negotiations for an improved offer will begin on July 16, 2007.

Romania wants to sell a 72.4 per cent stake in Daewoo Automobile Craiova. The government bought back the troubled car maker from its bankrupt owner, Daewoo Motor, in late 2006 for $51 million and paid another $10 million for debts stemming from past loans secured by the Korean company.

The country had earlier announced that it had received letters of intent from General Motors Corp, Russian Machines, and also Ford Motor Corp.

Meanwhile, a number of auto parts providers have set up shop in the new European Union member recently. This is due to the rising output of the Renault's Dacia plant, cheap labor, and favorable tax rates. However, a major shakeout may take place after a possible takeover of Daewoo Automobile Craiova by Ford.


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