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SEOUL, Sep 8 (Reuters) A consortium of India's Videocon Industries Ltd. and U.S. fund Ripplewood Holdings was picked as a primary bidder on Friday to buy South Korean appliances maker Daewoo Electronics for a reported price of around $700 million.

If successful, the deal would mark Videocon's third major acquisition in less than two years.

Woori Bank, one of Daewoo's leading creditors, said on Friday the bank named Videocon and RHJ International , the holding company of U.S. buyout fund Ripplewood, as the preferred bidder. South Korean private equity fund MBK Partners was named a reserve bidder.

Woori Bank officials declined to reveal the bid price, but the Maeil Business Newspaper said the Videocon consortium offered 670 billion to 680 billion won ($700 million-$711 million).

Exports-focused Daewoo Electronics was put up for sale by its domestic creditors, who own 97.5 percent of the unlisted firm.

They aim to sign a preliminary deal with the Videocon consortium in September, a Woori Bank official said.

Five bidders, including one local investor and four foreign firms, presented final bids for Daewoo on Aug. 17. Creditors did not reveal the unsuccessful bidders' names, but a creditor source had said a Malaysian investment fund was in the race.

ABN AMRO , Woori Investment&Securities Co.

and Samil PricewaterhouseCoopers are managing the sale.

Daewoo posted losses in 2005 and its earnings forecasts were not available. A creditor source had previously said banks wanted to sell the former unit of the failed Daewoo Group for more than $1 billion, considering its assets and business outlook.

Daewoo Electronics, which was placed under a debt rescheduling programme after its parent group went bankrupt in 1999, has since streamlined its business, focusing on televisions, air conditioning units and refrigerators.

Daewoo operates six plants in South Korea and 18 overseas units. Its assets totalled 1.65 trillion won at the end of 2005.

The company swung to a 94 billion won net loss in 2005 from a 30.4 billion won in net profit in 2004, according to the company's audit report, as a stronger won currency put pressure on its exports. Sales totalled 2.16 trillion won last year.

In 2005, Videocon, which makes televisions, picture tubes and home appliances, acquired television tube operations of France's Thomson for $291 million and the Indian unit of Swedish firm Electrolux for $76 million.

REUTERS PKS GC1037