Hanwha calls for return of deposit for Daewoo acquisition

By Nam Kwang-sik
SEOUL, June 19 (Yonhap) -- Hanwha Group said on Friday it has asked a Seoul court
to arbitrate a dispute over the return of a security deposit it submitted to the
state-run Korea Development Bank (KDB) in its failed bid to acquire Daewoo
Shipbuilding & Marine Engineering Co.
Hanwha signed a preliminary deal with KDB last November to buy a 50.4-percent
stake in the world's No. 3 shipyard, but scrapped the deal in January due to cash
shortages.
Hanwha put down a security deposit of 315 billion won (US$248.4 million) on the
fulfillment of the takeover deal.
Hanwha reportedly offered 6.5 trillion won for Daewoo Shipbuilding, but had
requested postponement of payment amid a severe credit crunch.
After the breach of the deal by Hanwha, KDB rejected the return of the deposit,
saying Hanwha did not carry out the contract and therefore forfeited the money.
Hanwha, however, called on the lender to return even part of the deposit,
claiming that the severe global financial crisis made it impossible to fulfill
the deal.
ksnam@yna.co.kr
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