New Delhi: India's leading television maker Videocon Industries Ltd is close to buy Daewoo Electronics of South Korea in what could be the biggest overseas acquisition by any Indian company, an official familiar with the deal said on Tuesday.
The two companies are negotiating the price after Daewoo said on Friday it had chosen Videocon as a ‘preferred bidder, ‘ said the Indian official, who didn't want to be named because the information was confidential.
The official said both sides also signed a memorandum of understanding on Tuesday so to facilitate the negotiations.
He wouldn't reveal the price Videocon was offering to Daewoo, but media reports have said the deal is estimated to be around $1 billion.
The biggest overseas acquisition so far has been the Tata group's $677 million purchase of New York-based Energy Brands Inc, which makes the popular Glaceau brand of soft drinks. That deal was signed August 23.
Daewoo, South Korea's third-largest electronics goods maker by sales, has been under a creditor-led debt-restructuring program since 2000 after its insolvent parent Daewoo Group was put under the workout program.
Creditors, including Woori Bank and Korea Asset Management Corp, now collectively own 97.6 per cent of Daewoo Electronics and have been seeking to sell the controlling stake since November 2005.
If everything goes well, Videocon could conclude a final contract with Daewoo around December, said Park Ki-hoon, an official of Woori Bank.
Videocon makes television sets, refrigerators, air conditions and many other home appliances.
The company has been aggressively looking for overseas buyouts to boost its presence in the global market.
Earlier this year, it bought the global picture tube business of French company Thomson SA for $289 million.
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