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| Kumho Asiana Group Chairman Park Sam-koo |
The Korea Development Bank (KDB) and other Kumho Tire creditors are expressing frustration with the head of Kumho Asiana Group, accusing him of not living up to his promises on the use of the Kumho trademark.
The creditors claim that Kumho Chairman Park Sam-koo promised to allow whoever acquires the struggling tire maker to use the Kumho brand for free when he met KDB Chairman Lee Dong-geol, Sept. 25. This was a day before KDB and other banks announced a plan to place Kumho Tire under a creditor-managed workout program.
However, Kumho Group officials dispute the creditors' account, insisting Park never promised the use of the Kumho brand for free. They say the chairman meant that he would let the buyer use the brand for a reasonable price.
The state-run bank said Friday it has written twice to Kumho Industrial, which owns the Kumho trademark, asking it to provide documents guaranteeing the free use of the brand. But it has not received any reply from the company, which Chairman Park controls.
"In order to complete due diligence on Kumho Tire and draw up its rescue plan in December, we need to straighten up all the issues concerning use of the Kumho brand," a KDB official said.
"As the Kumho chief promised in September, Kumho Group must allow the free use of the trademark for an entity that acquires the tire maker. If he doesn't keep his promise, we will have no choice but to take drastic measures," he said.
KDB recently decided not to give 2.2 billion won ($2 million) in severance pay to the Kumho chief, who served as Kumho Tire CEO for 13 years and six months.
"He has failed to turn the company around and should be held responsible for its trouble. So we decided to suspend the severance pay," the official said.
Kumho officials insist Park never promised the free use of the Kumho brand.
"The chairman never promised to allow anyone to use the trademark for free. This simply doesn't make any sense," one official said. "Kumho Tire has to pay 0.2 percent of its revenue in brand royalties like any other Kumho unit. Letting someone use the brand for free would be tantamount to committing breach of trust."
Kumho Tire creditors view Park as the main culprit behind the botched deal with Double Star, signed in March, because he made it difficult for the mid-tier Chinese tire maker to use the Kumho trademark after acquiring the firm.
After the deal fell through, KDB and other creditors, which hold a combined 42 percent stake in the cash-strapped tire maker, stripped Park of managerial control and subjected the firm to a stringent workout program to normalize operations.
