Daewoo To Expand If Thomson Bid Fails

J B Chun, chief executive of Daewoo Electronics Europe, said the group would prefer to acquire Thomson Multimedia (TMM), currently being auctioned by the French government as part of the privatisation of the entire Thomson defence electronics group. But he stressed that, even if the TMM bid fails, Daewoo would press ahead with its plans to expand in European consumer electronics.

Daewoo Electronics Europe has joined forces with the Lagardre conglomerate in the Thomson privatisation.

Under the terms of their agreement Daewoo would immediately take full control of TMM if the Lagardre bid succeeds, leaving Lagardre with the larger Thomson-CSF defence electronics business.

 

Daewoo has promised the French government it would protect the jobs of TMMs 5,000 employees in France and create another 5,000 new jobs.

Chun said it aimed to fulfil that pledge by using new and existing French plants to manufacture some of its Daewoo branded products and own-label goods.

It also plans to diversify, notably by making some of the television components that Daewoo and TMM currently buy from other companies.

Daewoo would then start selling those components to other sectors, such as personal computer makers.

Chun said Daewoo would adopt a similar strategy in North America, where TMM has a substantial share of the television and VCR market. The French company has a history of losses and management changes, but Chun said its brands could be revitalised and its finances transformed with better utilisation of overheads.

The Lagardre faction faces fierce competition from Alcatel Alsthom, the French telecommunications and power group, in the Thomson privatisation, which is expected to end next week when the French government announces the winner.