Fleet News

GM signs $251 million Daewoo Motor deal

THE long-awaited takeover deal between Daewoo Motor and General Motors has been agreed.

For a cash payment of $251 million (£171.7 million), GM takes a 42.1 per cent stake in a joint venture with Daewoo creditors to revive South Korea's third-largest vehicle producer.

'This is an important day for GM,' Jack Smith, GM chairman, said in a statement.

GM will buy Daewoo's Kunsan and Changwon plants in South Korea, with a combined annual output capacity of over 500,000 compact and sub-compact passenger cars. A further plant in Vietnam will be operated as part of the joint venture.

The Daewoo brand in Europe will be maintained and Daewoo Cars Ltd (DCL) management will now start working with a GM taskforce to create a new UK sales operation.

A Daewoo spokesman said: 'The terms of today's announcement indicated that DCL in the UK has not been included in the terms of the deal that relate to the transfer of the shares of individual sales companies.

'However, the future of the UK business is confirmed as GM and Daewoo in Korea will work with DCL to manage a prompt transition of the UK sales business to a new company.' UK customers, he said, can be 'fully reassured of a continuation of sales and service provision'.

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