September 10, 2007 / 6:06 AM / 11 years ago

GM Daewoo to buy 40 pct of Poland FSO for $255 mln

SEOUL, Sept 9 (Reuters) - GM Daewoo Automotive & Technology Co, South Korea’s No. 3 auto maker, said on Sunday it will buy a 40 percent stake in carmaker FSO from the Polish government for 238.7 billion won ($254.5 million).

With the stake purchase, the Polish auto maker will become a joint venture, tentatively named GM FSO.

The deal is part of GM Daewoo’s efforts to expand in Europe, but the South Korea-based company is unlikely to buy the remainder 60 percent in FSO, a GM Daewoo spokesman said.

General Motors Corp (GM.N) and partners took a majority stake in some of the assets of failed Daewoo Motor in 2002, creating GM Daewoo. But FSO and other car assembly lines in East Europe were left out of the deal.

Separately, the Korea Economic Daily said on Saturday in an unsourced report that GM Daewoo was expected to buy a former Daewoo Motor plant in Uzbekistan soon. The company spokesman said no decision has been made yet on the plant purchase.

In April, GM Daewoo President Michael A. Grimaldi told Reuters that the company was in talks with Romania to buy Daewoo Motor’s plant there.

($1=937.8 Won)

((Reporting by Kim Yeon-hee, editing by Jacqueline Wong; yeonhee.kim@reuters.com; Reuters Messaging: yeonhee.kim.reuters.com@reuters.net;+82-2-3704-5646)) Keywords: GMDAEWOO FSO/

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