Korean military pension fund to buy 50% stake in Kumho Tire

FONTANA, Calif. (April 22)—Kumho Industrial Co. Ltd. plans to sell its Kumho Tire unit to South Korea's Military Mutual Aid Association for $1.2 billion, according to Fontana-based Kumho Tire USA. The two parties signed a tentative agreement for the sale April 18, calling for the MMAA to control 50 percent of Kumho Tire, with Kumho Industrial retaining a 30-percent stake in the business, Kumho said. Other investors will control the remaining 20 percent. The MMAA's operating committee and Kumho Industrial's general shareholders are expected to approve the agreement in June, Kumho said in a statement. "The benefit of this agreement will be huge for Kumho Tire and Kumho Tire USA," said Kyu S. Cho, president of the U.S. unit. "This will lay the groundwork for continued growth in every aspect of our business, including capacity expansion and marketing activities." The MMAA is an investment fund for South Korean soldiers and military staff with assets of $2.88 billion.