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Hyundai Close to Deal with DaimlerChrysler on Commercial Vehicles

7 June 2000

    Seoul - Hyundai Motor and DaimlerChrysler are believed to be in the final 
stages of a deal to jointly produce commercial vehicles in the South Korean 
city of Chonju.

    According to Korean newspaper sources, DaimlerChrysler will take a 10% 
stake in Hyundai Motor as part of the arrangement.  It's thought that this 
deal may be the precursor to a closer relationship between the two companies.

    In the meantime, Hyundai and DaimlerChrysler are both participating in the 
international auction of Daewoo Motor.  However, due to fierce opposition from 
General Motors and Ford, and the South Korean government's indication that it 
will likely block Hyundai's bid (which would give it a near monopoly of the 
domestic market), neither Hyundai or DC are likely to succeed on its own.  
A joint bid would have a much greater chance of success, and apparently, the 
market is anticipating just such a move. Final bids for Daewoo Motor are 
due June 26th and preferred bidders will be announced four days later.  
A winner (?) should then be selected by September.

    An alliance between Hyundai and DaimlerChrysler would be a great boost to 
Chung Mong-koo, Hyundai's Chief Executive, who needs to elevate his image after 
the recent spat with his father, Hyundai founder, Chung Ju-yung and his younger 
brother.


MJR