Creditors to Force Sale of 19 Daewoo Units

Daewoo Group’s domestic creditors, abandoning a six-month debt reprieve, said they will force South Korea’s second-largest conglomerate to sell all but six of its 25 units. Daewoo will be left with just Daewoo Motor Co. and three other auto-related companies, the trading business of Daewoo Corp. and the heavy-machinery business of Daewoo Heavy Industries Co., creditors said. The plan mapped out by Daewoo’s major creditors must be approved by most other creditors, and the government said it will announce a restructuring plan Monday. Daewoo long resisted government pressure to sell two of its most profitable affiliates, Seoul Investment Trust Co. and Daewoo Securities Co. The sale of those units are probably inevitable, according to creditors, which are mostly nationalized banks controlled by the government. Without help from creditors, Daewoo will go bust. It needs at least $500 million a month in cash to pay interest on its $57-billion debt.