UNITED STATES: Kumho Tire to accelerate construction of U.S. plant in Georgia

Creditor banks of Kumho Tire have decided to inject an additional fund of 300 billion won to help the company build a new plant in the American state of Georgia.

As the tire manufacturer succeeded in securing the sorely needed investment fund, its effort to build the U.S. plant is expected to be accelerated.

According to industry sources, creditor banks including Korea Development Bank decided to lend 300 billion won to allow it to build the new plant in Georgia.

Currently the company is constructing a tire manufacturing plant with an annual capacity of 4 million tires at the cost of USD 424 million. Although its construction began in 2008, it was halted in the following year as the parent company entered a workout program. The project was resumed in August last year after the creditors approved the project.

Kumho Tire graduated from the workout program in December last year. But it has had difficulty securing sufficient investment funds as its debt reached as high as 3.5 trillion won.

A Kumho Tire official said, "Thanks to the latest decision by the banks, we could continue the construction of the Georgia plant without any delay. The current progress is at the rate of about 30 percent and we expect it to be completed by the end of this year and start the mass-production from next year."

Source: "The Korea Economic Daily", Seoul; 10 Feb 2015
(Syed Rashid Ali, Karachi, Pakistan)