Kumho tire in trouble… Creditors to enter receivership?
Kim Yang Hyuk | mj@ | 2018-02-26 10:56:59
[Digital Times, Kim Yang-hyuk] Kumho Tire Labor and Management has failed to meet deadline for submitting plans for corporate normalization proposed by creditors. As a result, creditors are interested in putting a superpower of "court management" and extending the deadline.
According to Kumho Tires on February 25, it is likely that creditors will not be able to reach an agreement on labor-management settlement until February 26, day of submission.
Competitiveness improvement measures (improvement of productivity, unpaid leave, change of work type, etc.), freeze of wages during the period of management improvement procedure, improvement of wage system (normal wage elimination) and adjustment (reduction), wage peak system implementation, Suspension and maintenance), and improper system and practices improvement are in the self-governing plan.
A representative of Kumho Tire`s labor union mentioned, "We cannot understand most of the company`s proposal."
The union made the 46th round of negotiations at the request of the company, but did not find any consensus after the lunar New Year holidays on February 19. Both the company and union officials said, "It seems difficult to meet the deadline (26th) to submit."
If there is no labor-management agreement in the area, Kumho Tires will not be able to find a new owner and will be forced to enter court administration. Creditors presented a MOU for the implementation of the plan on July 26, instead of extending the maturity of Kumho Tires` bonds, which entered the autonomous agreement system, by one year. If the agreement is not concluded due to labor-management disagreement, the extension of term expires. Creditors have already sent a letter to the company saying they will not extend the maturity of the bonds unless the labor-management agreement is reached, and will start the follow-up process.
Creditors have said they will follow up on the process, but it will be necessary to see if it will do so. Some creditor banks, which are concerned about huge bond losses, may oppose court management. There is a possibility that the labor and management may be given more time to agree.
Once a contract between Kumho Tires and creditors is signed, the sale of Kumho Tires will begin again in the near future. As a candidate for the takeover, China Double Star, which has been on the verge of selling off last year, is being reconsidered.
By Kim Yang Hyuk mj@
[ copyright ⓒ The Digitaltimes ]
According to Kumho Tires on February 25, it is likely that creditors will not be able to reach an agreement on labor-management settlement until February 26, day of submission.
Competitiveness improvement measures (improvement of productivity, unpaid leave, change of work type, etc.), freeze of wages during the period of management improvement procedure, improvement of wage system (normal wage elimination) and adjustment (reduction), wage peak system implementation, Suspension and maintenance), and improper system and practices improvement are in the self-governing plan.
A representative of Kumho Tire`s labor union mentioned, "We cannot understand most of the company`s proposal."
The union made the 46th round of negotiations at the request of the company, but did not find any consensus after the lunar New Year holidays on February 19. Both the company and union officials said, "It seems difficult to meet the deadline (26th) to submit."
If there is no labor-management agreement in the area, Kumho Tires will not be able to find a new owner and will be forced to enter court administration. Creditors presented a MOU for the implementation of the plan on July 26, instead of extending the maturity of Kumho Tires` bonds, which entered the autonomous agreement system, by one year. If the agreement is not concluded due to labor-management disagreement, the extension of term expires. Creditors have already sent a letter to the company saying they will not extend the maturity of the bonds unless the labor-management agreement is reached, and will start the follow-up process.
Creditors have said they will follow up on the process, but it will be necessary to see if it will do so. Some creditor banks, which are concerned about huge bond losses, may oppose court management. There is a possibility that the labor and management may be given more time to agree.
Once a contract between Kumho Tires and creditors is signed, the sale of Kumho Tires will begin again in the near future. As a candidate for the takeover, China Double Star, which has been on the verge of selling off last year, is being reconsidered.
By Kim Yang Hyuk mj@