GM Daewoo in talks to buy Romania Daewoo auto plant

By Staff
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Google Oneindia News

GOYANG, South Korea, Apr 5 (Reuters) GM Daewoo Auto&Technology Co., South Korea's No.3 automaker, is in talks with the Romanian government to buy failed Daewoo Motor's plant there, the company's president said on Thursday.

''We expect that there should be some direction by the middle of this year,'' Michael A. Grimaldi, also GM Daewoo's Chief Executive Officer, told Reuters in an interview on the sidelines of the Seoul Motor Show.

''There are many other companies that are interested,'' Grimaldi cautioned, adding: ''we'll probably know more in three months or so.'' Last year, Romania's government said the country hoped to wrap up the sale of carmaker Daewoo Automobile Romania by June 2007, after it recently bought back the majority stake from its bankrupt owner.

Romanian officials have said Ford Motor Co. , Renault SA-Nissan Motor Co. , China's Chery Automobile and India's Tata were also interested in the Romanian Daewoo plant.

General Motors Corp. and other partners took a majority stake in some of the assets of failed Daewoo Motor in 2002, creating unlisted GM Daewoo.

Grimaldi was upbeat on the company's prospects this year, saying GM Daewoo should post sales growth in line with the 20 percent to 30 percent growth showing in 2005, provided the plants continue to run at maximum capacity.

On Wednesday, GM Daewoo posted annual net profit of 593 billion won (3.7 million) for 2006, up 805 percent from 65.5 billion in 2005 as a one-time gain and brisk sales abroad lifted its bottom line.

GM Daewoo also announced 2006 revenue of 9.60 trillion won (.26 billion), up 27 percent from 7.53 trillion in 2005.

GM Daewoo has said it expects its sales to rise about 20 percent to 1.7 million-1.8 million vehicles this year, after the company sold 1.53 million units, including kits, in 2006.

Although the bulk of GM Daewoo cars are sold under the Chevrolet brand abroad, others sell as Pontiac, Holden and Suzuki models.

REUTERS SBA RN0716

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