20 Feb Exclusive: GM offers $2.2 billion debt for equity swap in return for Seoul’s support – sources
SEOUL (Reuters) – General Motors (GM.N) has offered to convert debt of around $2.2 billion owed by its ailing South Korean operation into equity in exchange for financial support and tax benefits from Seoul, four sources with direct knowledge of the matter said.
The restructuring proposal comes after the Detroit automaker announced last week that it would shut its plant in the city of Gunsan, southwest of Seoul, by May and decide the future of the remaining three plants in the country within weeks.
The debt for equity swap would allow GM’s business in South Korea to continue operating. It was not immediately clear how the deal would affect the interest of the state-run Korea Development Bank, which owns 17 percent of GM Korea.