이 기사는 2021년 10월 19일 08:05 thebell 에 표출된 기사입니다.

Kumho Tire is in talks with three potential buyers to sell the land in Gwangju, a southwestern city of South Korea, on which its plant is located, according to industry sources.

The South Korean tire maker has entered discussions separately with three investor groups led by Mirae Asset Securities, Samsung Securities and Bookook Securities, respectively. Bookook Securities, which is considered less financially capable than the other two rival securities firms, teamed up with Hoban Construction.

Prices offered by the three consortiums reportedly range between 800 billion won ($675.4 million) and 1.3 trillion won, while Kumho Tire is seeking a 2 trillion won valuation.

The significant difference in valuation reflects a different view between the seller and potential buyers on the possibility of converting the land use to commercial, sources said.

The Gwangju Metropolitan Government has made it clear that any change in the land use is not permissible under the relevant law until the company shut the plant down. Kumho Tire can close the plant only after building a new one, which hasn’t started construction yet. This means any new owner of the land would have to wait for at least three years to change the land use.

In contrast with potential buyers, who think there is some degree of uncertainty about a potential change in the land use, Kumho Tire is understood to want the price tag reflective of the land use being converted to commercial.

The company’s Gwangju plant is located on the land spanning 420,000 square meters, not far from the city’s high-speed rail station. The area near the station has recently been designated for tourism development.

Any agreement will depend on whether Kumho Tire will lower its valuation target, industry watchers said. The company plans to move its Gwangju plant, which was built in 1974, to Hampyeong, South Jeolla Province, by using the proceeds from the land sale. (Reporting by Byungkeun Kam)