Aju Business Daily

SEOUL --  Kumho Tire's union and management signed an agreement Monday to normalize the operation of South Korea's second-largest tiremaker, a day after workers voted to accept an investment from a Chinese company.

The agreement paved the way for creditors to conclude a deal on the sale of a 45-percent stake to China's Doublestar, help the debt-stricken company avoid insolvency with a quick injection of 200 billion won (189 million US dollars) and extend debt maturity.

Of 3,100 union members, 2,741 participated in a vote on Sunday and 60.5 percent voted for Doublestar which has promised to guarantee job security for at least three years. Workers agreed to freeze their wage and reduce some work benefits while Doublestar will invest 646.3 billion won in new shares. Kumho Tire is saddled with about a total debt of 2.4 trillion won with its net losses soaring from 38 billion won in 2016 to 88.56 billion won last year.