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HDC shoots back at Kumho

Claims Kumho never fully delivered their side of bargain, 2nd review neccessary to prevent insolvencies

HDC Hyundai Development Company on Thursday blasted at Kumho Industrial as the party responsible for hindering their acquisition deal and said a new round of due diligence is necessary to prevent both firms from facing insolvency together should they push ahead. Kumho owns Asiana Airlines.

“We are deeply disappointed that the seller is pinning the blame of breaching the contract on the buyer when HDC Hyundai Development Company has been duly following the acquisition process by procuring funds and filing for a merger review,” the building company said in a statement.

The comments come just days after Korea Development Bank, one of Asiana’s creditors, joined the back-and-forth and sided with the airline.

Saying that HDC would be to blame if the deal falls apart, KDB Chairman Lee Dong-gull said on Monday that the construction company should clarify whether they still wish to buy the airline by Wednesday next week, when the contract ends.

Both Asiana and KDB have opposed the idea of another review as the airline has already undertaken a seven-week due diligence process.

HDC however rehashed its calls on Asiana to agree to another round on Thursday as it called the step “essential to understand the reality and plan for the future of the airline.”

Claiming that both Asiana and Kumho Industrial have never faithfully provided them with documents from the start of the acquisition process, HDC also called on the creditors to refrain from leaning towards the “groundless argument” of the airline. It also said that since the deal was made on Dec. 27, 2019, Asiana’s debt has increased by 2.8 trillion won.

Those siding with Asiana, meanwhile, argue that HDC is either trying to pull the plug on the deal, or lower the acquisition price. 

By Yim Hyun-su (