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Korea favours Daewoo Motor sale to foreigners: KDB

SEOUL: State-run Korea DevelopmentBank, the key creditor of Daewoo Motor, favours selling thetroubled firm to foreign investors over allowing it operateindependently or nationalising it, a bank official said onSaturday.

"We will pursue an overseas sale for the firm as it lookslike a best solution." said Yoo Oui-kyung, an official at thebank. Yoo quoted a study by a group of local scholars on DaewooMotor as saying nationalising the auto maker would have sideeffects like greater burden on taxpayers, managerialinefficiency and trade conflicts.

The study said it was impossible to expect the company toturn itself around independently with 17.91 trillion won ofliabilities.

The official said the acquisition by the country's largestcarmaker Hyundai Motor of the carmaker would only trigger athorny issue of monopoly.

The study called for a swift overseas sale through alimited competitive bidding process, he said.

Currently, four international automakers--General MotorsCorp, Ford Motor Co, Daimler Chrysler AGand Italy's Fiat have expressed their interest toenter an auction to buy the troubled local automaker. Hyundai Motor is also expected to bid.

Last week, the head of a committee overseeing therestructuring of the Daewoo Group said one or twopriority candidates would be chosen for negotiations by the endof May.-Reuters