* Other shareholders stay away from share offering
* GM to consider further financial assistance if necessary
* GM Daewoo to use funds for general purposes, maturing debt
(Adds details, quote, background)
SEOUL, Oct 23 General Motors Co [GM.UL] bought
all of the new shares offered by its struggling South Korean unit
for $413 million and the U.S. carmaker will consider further
financial aid if necessary, GM Daewoo said on Friday.
GM decided to subscribe to the entire rights offering as
other shareholders, including Korea Development Bank (KDB), SAIC
Motor Corp (600104.SS) and Suzuki Motor (7269.T), did not join
the offering, GM Daewoo Automotive & Technology said.
Last month, GM Daewoo said it would raise 491.2 billion won
($413.4 million) by selling new shares to existing shareholders.
GM would consider more financial help for the South Korean
unit, said Nick Reilly, president of GM International Operations.
"Any further actions related to the longer term funding
structure of GM Daewoo will be considered if necessary, " Reilly
said in a statement.
The decision came as GM and KDB, GM Daewoo's main creditor,
failed to reach an agreement in talks over 1 trillion won of
additional financial support for the South Korean unit.
KDB had said it wanted the sum of the rights offering more
than doubled and that it would not participate in the offering if
GM did not meet its requests, such as sharing licenses for cars
"The money came from GM's global operations," said GM Daewoo
spokesman Kim Sung-soo.
GM is barred from using any of its own $50 billion lifeline
from the U.S. government to support overseas operations and would
have to dip into money from its non-U.S. operations.
With the investment, GM's stake in GM Daewoo rises to 70.1
percent from 51 percent, while KDB's stake falls to 17 percent
from 28 percent.
GM Daewoo said it would use the proceeds for general
purposes, including funding the repayment of maturing debt.
(Reporting by Cheon Jong-woo and Rhee So-eui; Editing by Chris