Daewoo advances on Europe

South Korea's Daewoo Group continues its push into Europe with a letter of intent to take a 65% stake in four of eight vehicle and component operations belonging to Austria's Steyr-Daimler-Puch AG, the same company that builds Chrysler's minivan in Europe. Under the agreement, Daewoo will invest $260 million in the operations, including the $1 1 0 million purchase price for the equity. Daewoo expects to concentrate its efforts in new engine, passenger car and commercial-vehicle development. The planned investment into Steyr is Daewoo's latest move in expanding its European presence. Daewoo already has a vehicle research center in Britain and a powertrain research center in Germany. In early 1995, Daewoo and Steyr jointly took over Avia of the Czech Republic, a leading national truckmaker, in order to develop commercial vehicles. Daewoo also has a joint venture in Romania for production of its Cielo sedan and expects to expand production there to include engines and transmissions. Last June, Daewoo signed an agreement to take a 61% equity interest, valued at $34.5 million, in Polish truckmaker FS Lublin. Daewoo plans to produce small trucks and passenger cars at the facility.