Linglong Tire Quits Contest for Kumho Tire Equity

Shandong Linglong Tire Co., Ltd. reported on Nov. 25 the progress about asset procurement and announced to resume trading as from Nov. 28.

The company said in the announcement that each relevant party participating the M&A event had discussed the issue and finally decided to stop participating in the M&A.

Before that, Linglong released the trade suspension announcement on Nov. 14 for overseas asset procurement.

The company said on Nov. 19 that it planned to buy the equity of a Republic of Korea-based tire producer and completed the first round of bids.

The company gave three reasons for its quit: the target company suffered losses; avoiding overseas investment risks; and protecting the vast investors interests.

There are not so many Korean tire producers and Kumho Tire is the only one intends to sell the equity. People analyzed that Linglong might have also participated in the contest for Kumho's equity.

Currently, it is unclear about the bidders of Kumho Tire and it is said that five companies are within the finalist. After Linglong's quit, there are still two Chinese companies within the bidders: ChemChina and Qingdao Doublestar.