No deal on LG Card rescue but more talks seen

Senior officials from state-run Korea Development Bank, LG Card's leading creditor, and the LG Group met late on Wednesday to discuss the proposed $1.15 billion bailout, a KDB spokesman said on Thursday.

"There was no progress from the discussions," the spokesman said. "The schedule for the next meeting has not been set."

LG Group, the former parent of LG Card , offered on Wednesday between 180 billion won ($173 million) and 264.3 billion won -- up to about a third of the 770 billion won creditors had sought from the group -- to bail out LG Card.

Creditors said they could not accept the offer and would wait for the group to put forward a higher figure.

"LG Group is trying to evade responsibility," said KDB in a statement released Thursday. "Even now, creditors are willing to accept if LG Group makes a practical and reasonable proposal."

They had set Wednesday as the deadline for LG Group to join the rescue package and threatened LG Card would be liquidated without LG Group taking part.

Now both sides have said they would allow more time to negotiate.

"We could discuss the bailout further," said a LG Group spokesman. "Creditors should come up with a fair and reasonable counter offer on ways to divide up the financial burden."

Shares in LG Card rose 4.28 percent to 15,850 won by 0347 GMT, after rising by as much as 8.88 percent earlier, on hopes creditors and LG Group would eventually strike a deal. The broader market was up 0.95 percent.

LG Card, which narrowly escaped bankruptcy in January after a $4.5 billion bailout package was agreed, needs a further cash injection soon to avoid its shares being delisted next year. The delisting would trigger massive debt redemption requests and bankrupt the company, creditors say.

The Korea Stock Exchange can delist a company if its debt exceeds its assets for two years running.

LG Card owes 12.6 trillion won in loans and debt securities, including 6.6 trillion won in uncollateralised debt. ($1=1041.0 Won)

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