GM plans to regain complete control of its South Korean unit by buying the 17% stake held by Korea Development Bank.
Although GM owns almost 77% of its South Korea unit, Korea Development Bank owns 17% of it, which means that the state-run bank has the right to veto decisions made by the automaker. An official from the bank said that Tim Lee, head of international operations at GM, made an ‘informal offer’ Friday, October 19th, to the bank’s Chief Executive Kang Man-soo, during a meeting in South Korea.
GM Korea was formed in 2002 after GM bought a majority stake in failed Daewoo Motor, and it is currently the third biggest automaker in Korea after Hyundai and Kia. The rest of 6% stake in the company is owned by China’s SAIC Motor Corp. Korea Development Bank said that it will consider selling its stake after it receives an official proposal.
Although South Korea is a small market for GM, it is one of the automaker’s production bases, from where the company exports Chevrolet models to Europe and several other countries. South Korea accounts for almost a quarter of the Chevrolet production globally.