DAEWOO MOTOR CO. is prepared to sell part of the company to General Motors.
The two carmakers, who ended an often stormy, 14-year marriage in 1992, signed a memorandum of understanding earlier this month to explore partnership possibilities.
'We're looking at anything and everything that has good business opportunities,' said GM Korea President Alan Perriton. 'It's an open storefront.'
Perriton denied press reports that GM might take over Daewoo Motor for about $4 billion as having 'no foundation in truth.'
The memorandum commits the companies to explore:
l GM taking a stake in Daewoo
l Increased parts sharing
l Asset swaps
l Joint car production in Poland.
'The significant focus is on Korea and Asia-Pacific because Korea is such an integral part of Asia,' said Perriton.
'It's safe to say Daewoo wants and needs money from a deal,' said Kim Yong-Tae, auto analyst at SsangYong Securities Co. Ltd. in Seoul. 'GM wants a production base in Asia, a beachhead for China and the region. And Korea has an excellent parts infrastructure.'
The two carmakers agreed that Daewoo service centers in 10 Korean cities will begin servicing GM vehicles.
Earlier, GM relied on an independent distributor, Inchcape, which has pulled out of the Korean market.
Meanwhile, a Daewoo task force is studying the future of SsangYong, which Daewoo now controls.
SsangYong sources in Europe said Daewoo would turn SsangYong into a semi-independent 4x4 division, and the SsangYong brand would slowly disappear.
The sources also said that European SsangYong distributors who had been successful in their markets were likely to keep their franchises.
SsangYong also builds a luxury sedan and light commercial vehicles based on Mercedes-Benz trucks for the Korean and Southeast Asian markets. Daewoo wants to increase export of these vehicles.