SEOUL (Reuters) –
South Korea's Kumho Asiana Group said on Sunday it had decided to put Daewoo Engineering & Construction Co (047040.KS) up for a sale to ease investors worries about its liquidity.
Kumho Asiana may consider various ways to unload Daewoo including a sale of a 39 percent stake held by financial investors with management rights, a sale of a 50 percent stake plus one share, or a sale of a 72 percent stake owned by the group and financial investors.
The group has a stake of about 33 percent in Daewoo with financial investors holding 39 percent and the rest free-floating shares. It bought Daewoo for about 6.4 trillion won ($5.01 billion) in 2006.
"The size of the sale will be decided after talks with the main creditor and advisers to minimise the group's losses from the sale of Daewoo and to reduce buyer's acquisition burdens," Kumho Asiana said in a statement.
Kumho Asiana plans to consider a tender offer or a sale to a private equity fund of the state-run Korea Development Bank (KDB), its main creditor, the group added.
The group said it had talks with plural investors at home and abroad but failed to reach a final agreement as their proposal may boost the group's debt.
Kumho Asiana has been haunted by worries about its liquidity after buying two coveted assets -- Daewoo and Korea Express (000120.KS) in the past few years.
The concerns deepened as the global financial crisis delayed its announced plans to raise 4.55 trillion won by selling non-core assets.
The construction and airline-focused group may be liable to pay substantial sums due to a put-back option agreement with investors in its 2006 takeover of Daewoo as its stocks have remained far below a pre-set price for the option.
Kumho Asiana offered an option to buy back Daewoo shares at 32,000 won each by the end of this year, local media said, while shares in Daewoo ended at 12,850 won on Friday. Officials at the group were not available for comments on the option price.
Earlier this month, Kumho said the KDB had agreed to the proposal to attract new financial sponsorship for Daewoo by the end of July -- a move to replace the existing investors in Daewoo, who have the option.
(Editing by Jerry Norton)
RALEIGH, N.C. –
Seattle-based Amazon said it wrote to Web site operators, telling them its "Associates program" will end after Friday. Web sites that posted links to the company about its products have received up to a 15 percent cut on sales.
But the Legislature is considering a provision in its final budget plan designed to collect sales taxes on these so-called "click-through" transactions.
Competing House and Senate plans both contain the provision, so it's likely to be in the compromise budget proposal that could be approved in the next several days.
"We felt that we had to take this step and it's unfortunate," Amazon spokeswoman Patty Smith said of discontinuing the program. "But we feel like we have little choice."
Amazon believes the proposed law would be unconstitutional, so eliminating the commission would prevent the company from having to collect the current 6.75 percent sales tax most consumers pay on purchases at in-state stores.
"In the event that North Carolina repeals this tax collection scheme, we would certainly be happy to reopen our Associates program to North Carolina residents," the e-mail said.
The provision would require companies that have reported more than $10,000 in sales each of the last four quarters through agreements with Web sites making referrals to collect the tax on the state's behalf.
North Carolina expects to collect an additional $13.2 million in the coming fiscal year on the "click-through" transactions and by companies collecting sales taxes on music, video and software downloads purchased electronically, according to a legislative fiscal analysis.
North Carolina taxpayers currently must pay sales taxes for out-of-state purchases on their annual tax return, but it's an honor system.
Amazon's announcement is the latest in a legal fight involving states trying to get out-of-state companies that perform commerce largely online with their residents but have little or no physical presence in the state to collect taxes.
The stakes are large. Governments could generate $3 billion in new revenues if Web retailers had to collect taxes on all sales to consumers, according to Forrester Research.
Amazon sued New York in 2008 over a law similar to what North Carolina lawmakers are proposing because it argued it unlawfully imposes tax-collection obligations on out-of-state entities. A trial court judge dismissed the case in January.
MILAN (Reuters) –
Italian automaker Fiat (FIA.MI) is open to issuing a bond for institutional or retail investors, or both, Chief Executive Sergio Marchionne said on Saturday, according to news agency Ansa.
On Friday, Marchionne had said that reports Fiat might launch a bond of around 1 billion euros were "rumors" adding, "We will announce it when we announce it."
Asked at an event in Venice on Saturday whether Fiat would be willing to issue a bond for the retail or institutional market, Marchionne said: "We are open to doing either, or a mix."
"With the interest rates that are around at the moment, it could be a big deal for everyone," he added.
Italian oil company ENI (ENI.MI) said on Friday offers for its retail bond topped 5.8 billion euros compared with a maximum offer amount of 2 billion euros.
Marchionne also said it was premature to discuss any plans regarding production at its joint venture plant near Valenciennes in France with PSA Peugeot Citroen (
Fiat has taken a 20 percent stake in U.S. car maker Chrysler (CBS.UL) and Marchionne is working to put together a plan for the U.S. car maker's product offer.
Daily Il Giornale had cited rumors the Fiat-Chrysler plan could see the platform for Chrysler's Voyager model extended to the Phedra, affecting a collaboration Fiat has with PSA.
"The Voyager platform will continue to be American because it was born there," Ansa quoted Marchionne saying.
"It is premature to talk about convergence (until) we have decided with the French what Valenciennes will do," he said.