Daewoo-FSO shareholders agree on debt-reduction plan

By the end of this year a final contract is planned to be signed between British car maker MG Rover and the creditors of Daewoo-FSO concerning formation of the New Small Company, which will be engaged in construction of Rover cars in Poland. If that happens, production is to begin in the second half of 2003. The General Shareholders' Meeting, which commenced on September 25, ended yesterday. It was decided, and agreed by the court commissioner of Daewoo headquarters in Korea, that debts totalling zl. 1.6 billion will be swapped for Daewoo-FSO shares, in which event, the company's debt index will fall, and at the same time the increased capital will be sufficient to cover net losses, which amounted to zl. 1.1 billion in 2001. However, this can only happen if all the company's creditors and the Korean commercial court agree by December 31, 2002. The shareholders' decision "clears the way for further negotiations" with Daewoo-FSO's creditors, said Zbigniew Gryglas of the State Treasury, which holds a stake of almost 10% in the plant, "but it's hard to talk about a breakthrough," he added. (Rzeczpospolita, p.B4; Reuters) A.K.