Morgan Stanley Private Equity was named as the preferred bidder to buy South Korea's ailing Daewoo Electronics, Daewoo's key creditor Woori Bank has announced.
Woori Bank said Morgan Stanley Private Equity “scored the highest” following a review of proposals from bidders which included pricing and their business plans.
The announcement came after creditors failed to reach an agreement with India's Videocon Industries due to pricing differences. The consortium reportedly wanted a 13% discount to the initially agreed $700 million price tag.
The bank said creditors plan to sign a memorandum of understanding with Morgan Stanley as soon as possible before a final deal, possibly in May, after due diligence and price negotiation.
Creditors including the state-run Korea Asset Management Corp, Shinhan Bank, Korea Exchange Bank and Woori Bank, hold a combined 97.5% interest in Daewoo.
Daewoo Electronics is a former unit of the Daewoo Group, which collapsed in 1999 with 80 billion US dollars in debt in one of the world's largest corporate failures.
Ranked behind Samsung Electronics and LG Electronics in the domestic market, Daewoo Electronics posted a net loss of 188.6 billion won on revenue of 2.08 trillion won in 2006.
It produces a range of goods including TVs, air-conditioners and washing machines, with its extensive overseas sales networks seen as its key strong point.