Daewoo Craiova reverts to the state

The representatives of the Romanian state signed a contract on Wednesday to buy back a 51% stake in Daewoo Automobile Romania carmaker from Daewoo Motor Korea. The signing of the contract between the Romanian and Korean parties took place after having been repeatedly postponed for almost a year. The transaction will cost the Romanian party 60 million dollars (48 million euros). The Koreans will collect 50 million dollars (40 million euros) in cash from the Craiova-based car factory for the stake, with the remaining 10 million dollars (8 million euros) accounting for debts of the Craiova-based plant to companies from the Daewoo group. The total value of receivables of the Craiova-based plant exceeded 530 million dollars (424 million euros). The Romanian party was assisted in the transaction by the Tuca, Zbarcea & Asociatii (Tuca, Zbarcea & Partners) law firm. “The transaction is estimated to be completed in the October 15-20, 2006 period, with privatisation procedures of the plant with a strategic investor starting within two months from its completion,” stated the minister of economy and commerce, Codrut Seres.