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Welcome to the Hankook Tire press room, where you can access the latest news on Hankook Tire and our industry.
Date04/21/2006 Hits28,114

CategoryCorporate

Hankook Tire Signs Term Loan Agreement in Hungary

Hankook Tire Signs Term Loan Agreement in Hungary

■ Signed €100 million term loan agreement for investment into Hungary plant
■ 11 lenders include Korea Development Bank, Woori Bank, Hana Bank and BNP Paribas
■ Plant construction to begin this May, with goal of starting production in July 2007

Hankook Tire (www.hankooktire.com, CEO Cho Choong-hwan) signed a term loan agreement for €100 million to finance

its new manufacturing plant in Hungary. The agreement was signed on April 4th (local time) at the Intercontinental Hotel in Budapest, Hungary. Taking part in the signing ceremony were president of Hankook Tire European Regional Headquarters Suh Seung-hwa, vice president of finance Lee Jong-cheol,

head of Hankook Tire Hungary Lee Eung-yong and representatives from 11 Korean and foreign banks

Korea Development Bank (KDB) acted as lead manager in the syndicated loan of 11 domestic and foreign banks including Woori Bank, Hana Bank, Korea Exchange Bank (Germany), National Agricultural Cooperative Federation, KDB Asia Limited, Bayerishe Hypo und Vereinsbank AG's Hong Kong branch, Caylon Bank’s Seoul branch, Mizuho Corporate Bank Limited, BNP Paribas Hungary and ING Bank (Hungary). The Hungarian unit of Hankook Tire signed the agreement and the loan will be guaranteed by the Hankook Tire parent company.

KDB department head Choi Chul-seong said, “The loan term is relatively long at five years and despite various difficulties such as this being the first Euro financing for Hankook Tire, we were able to procure the equivalent of €185 million in loans. This is nearly double the figure initially hoped for by the company. It reflects the lenders’ high opinion of the future growth potential, technological capability and stable profit-making ability of Hankook Tire.’

Earlier on October 31st 2005, Hankook Tire signed an investment agreement with representatives from the Hungarian government at its Seoul headquarters. The new plant will be located on a 530-thousand square meter site in Dunaujvaros, 68km south of Budapest. The factory will produce UHP tires for passenger vehicles and tires for light trucks.

Construction on the factory is expected to begin in mid-May, with a goal of starting operations in the second half of 2007. When all work is completed in 2010, the Hungarian plant is projected to run at full capacity of 10 million units a year, elevating Hankook Tire to the top five tire makers in the world in terms of market share. A total of €500 million is expected to be invested in the plant.

 


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