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#4715525 - 04/03/18 07:49 PM Kuhmo Sells To Doublestar
tenderloin Offline


Registered: 12/16/02
Posts: 6518
Loc: Huntington Beach, CA
SEOUL, South Korea After months of uncertainty, it appears Kumho Tire Co. Inc. will have a new owner China's Qingdao Doublestar Tire Co. Ltd.

Kumho announced April 4 that its management and union have agreed to a plan by the firm's creditors to sell a controlling stake in South Korea's second-largest tire maker to Doublestar.

Although Kumho did not release financial figures, European Rubber Journal, Tire Business' sister publication, reported that Doublestar's investors' group would acquire a 45-percent stake from shareholder Korea Development Bank (KDB) through a $630 million private placement of shares to Doublestar and three Chinese state-owned companies, Qingdao Conson Development (Group) Co. Ltd., Qingdao City Construction Investment (Group) and Qingdao Port International Co. Ltd.

The transaction, Kumho said, would begin through rights issues in the next three months.

Kumho said Doublestar has guaranteed that Kumho's management team, based in Seoul, will continue to operate the tire maker independently and build the brand. It said that Doublestar has vowed "to invest a substantial amount of capital in the company to get it back on track and profitable."

Kumho said additional Kumho creditors will invest more capital to cover expenditures to resolve the current debt and liquidity crisis. "Planned capital invests will be leveraged to stabilize the company and upgrade and expand manufacturing and R&D facilities, augment innovative technology and increase OE supply opportunities across the globe," the company said.

In the announcement, Kumho said it would focus on upgrading production lines for eco-friendly tires to better compete in the "highly competitive, technology-intensive market segment." It said it also plans to make its tires more affordable by normalizing production in China and enhancing quality by improving production in Korea and across the world, in order to "help build its brand value further."

KDB, a South Korean state-owned policy bank, is part of a consortium that owns a 42-percent stake in Kumho; the consortium's ownership will drop to 23 percent after the placement.

In late 2016 Doublestar agreed to buy KDB's stake in Kumho before disagreements over trademark rights and Kumho's profitability eventually led to the cancellation of the deal.

The new price is 30-percent lower than the old price, Doublestar said.

In late March, Korean tire retailer Tire Bank declared its interest in acquiring Kumho, but insiders questioned whether the company had the financial resources to effect a deal, according to various Korean press reports.

Daejeon, South Korea-based Tire Bank is described as a family-owned business operating 400 outlets throughout Korea, generating roughly $345 million in annual sales.

The Korea Herald and other Korean newspapers reported March 27 that the tire retailer had placed its bid just four days before a deadline set by creditors to inject capital into Kumho.

Kumho reported an operating loss of $39.6 million for the nine months ended Sept. 30, 2017, on sales of $1.66 billion. Full-year financials have not been released.

Kumho last year completed a $500 million project to relocate and upgrade separate passenger and truck tire plants to a single site in Nanjing, Jiangsu, China.

Doublestar was No. 23 on Tire Business' 2017 Top 75 tire makers' ranking, with 2016 sales of $1.06 billion. Kumho was No. 14, with sales of $2.4 billion

kuhmo

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#4715552 - 04/03/18 08:12 PM Re: Kuhmo Sells To Doublestar [Re: tenderloin]
jmsjags Offline


Registered: 10/16/09
Posts: 649
Loc: Richmond, VA
Kuhmo only sells one line of tires that I ever see anyone buy and that's Solus.
_________________________
2018 VW Golf Sportwagen
2008 Ford Focus

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#4715575 - 04/03/18 08:54 PM Re: Kuhmo Sells To Doublestar [Re: jmsjags]
JHZR2 Offline



Registered: 12/14/02
Posts: 41669
Loc: New Jersey
Originally Posted By: jmsjags
Kuhmo only sells one line of tires that I ever see anyone buy and that's Solus.


I think they have become OE on more and more cars...

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#4715635 - 04/03/18 10:30 PM Re: Kuhmo Sells To Doublestar [Re: tenderloin]
CKN Offline


Registered: 10/14/14
Posts: 3637
Loc: Utah
They are OEM on some BMW models. Among others.

And before someone calls DoubleStar Chinese junk(you know it's coming)-they have accumulated millions of miles on big rigs.


Edited by CKN (04/03/18 10:33 PM)

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#4715640 - 04/03/18 10:47 PM Re: Kuhmo Sells To Doublestar [Re: tenderloin]
Reddy45 Offline


Registered: 08/15/08
Posts: 2903
Loc: USA
45% isn't a controlling interest though.

I don't see this as bad news and will gladly buy Kumhos if they continue to provide a good value.

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#4715691 - 04/04/18 12:06 AM Re: Kuhmo Sells To Doublestar [Re: tenderloin]
nthach Offline


Registered: 01/02/04
Posts: 3814
Loc: California
Kumho is a strange company - their biggest business line is Asiana Airlines, the 2nd biggest carrier in Korea. Most Korean companies are part of chaebols - the Korean version of a conglomerate which stretches across industries.

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#4715726 - 04/04/18 02:42 AM Re: Kuhmo Sells To Doublestar [Re: tenderloin]
02SE Offline


Registered: 12/30/05
Posts: 2676
Loc: The Canyons
I hope they continue producing the tires I use on one of my cars. They have proven to be excellent.

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#4715727 - 04/04/18 02:45 AM Re: Kuhmo Sells To Doublestar [Re: jmsjags]
PandaBear Offline


Registered: 08/05/02
Posts: 14169
Loc: Silicon Valley
Originally Posted By: jmsjags
Kuhmo only sells one line of tires that I ever see anyone buy and that's Solus.


I use the LX Platinum.
_________________________
"You keep asking questions PandaBear and you'll end up a vegetarian like my wife" - Camu Mahubah

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#4715748 - 04/04/18 04:45 AM Re: Kuhmo Sells To Doublestar [Re: tenderloin]
Richie Offline


Registered: 06/10/04
Posts: 274
Loc: Valencia, CA
I've had good luck in the past with kumho tires and would buy again.

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#4716171 - 04/04/18 12:42 PM Re: Kuhmo Sells To Doublestar [Re: JHZR2]
nthach Offline


Registered: 01/02/04
Posts: 3814
Loc: California
Originally Posted By: JHZR2
Originally Posted By: jmsjags
Kuhmo only sells one line of tires that I ever see anyone buy and that's Solus.


I think they have become OE on more and more cars...

Not just that, Kumho is a popular tire in the autocross/"tuner and ricer" scene as well - I think they sponsored a SCCA series as well. Kumho was selling cheap tires in the US decades ago, I think they used motorsports to reinvent their brand here - Hyundai then was installing Michelin or Goodyear as OEM on US-speced cars.

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#4716353 - 04/04/18 03:54 PM Re: Kuhmo Sells To Doublestar [Re: jmsjags]
edyvw Online   content


Registered: 03/08/12
Posts: 4952
Loc: Colorado Springs
Originally Posted By: jmsjags
Kuhmo only sells one line of tires that I ever see anyone buy and that's Solus.

They sell Ecsta too.
Had them on VW CC Ecsta LX. It is remarkable what kind of junk that was.
_________________________
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