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No takers for STX's coalition proposal for DSME

No takers for STX's coalition proposal for DSME

Seoul: South Korean shipbuilder STX has not seen a take up of its offer to partner one of the four companies bidding for Daewoo Shipbuilding & Marine Engineering (DSME). The company, which had held back from issuing an independent bid due to a negative market reaction to the proposed acquisition, recently jumped into the fray and offered to form a consortium for the purchase.

"We want to participate in the Daewoo Shipbuilding bidding. But we will invest a maximum of 300bn won to grab some managerial rights for the world's third-biggest shipyard," Lee Jong-chul, the group's vice chairman said.

However, according to the Korea Times, three out of four bidders - POSCO, HHI and Hanwha Group - have declared that they are not interested in the offer, while the last bidder -GS Group - has shown no interest in the proposal. The paper speculates that strong opposition by the Daewoo's union and management's bid screening committee, which believe that STX involvement would result in major layoffs, has played a part in the rejection.

Analysts estimate the acquisition to garner an estimated $8bn - double DSME's current value.  [11/09/08]