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Last Updated: Friday, 9 December 2005, 10:04 GMT
Creditors in Samsung court move
Samsung
Samsung is South Korea's biggest company
Creditors have started a lawsuit against Samsung Group, seeking repayment of alleged debts still owed from a former Samsung subsidiary.

The creditors are seeking debts of 4.7 trillion won ($4.5bn; 2.6bn) they say are still outstanding from the failed Samsung Motors.

To cover the debt, Samsung Group gave the creditors shares in another of its firms, but they are unhappy with this.

The case is said to be largest ever claim made in a Korean civil court.

'Float pledge'

Samsung Motors went into receivership in 1999 before being taken over by French carmaker Renault.

Samsung Group, South Korea's largest firm, gave the creditors of Samsung Motors 3.5 million shares in sister business Samsung Life, its insurance unit, to cover their debt.

However, the creditors claim this was only on the understanding that Samsung Life would subsequently be floated off, enabling them to sell their shares and recoup their money.

This float has not since taken place.

"Samsung Motors' creditors have continued to demand the Samsung side make good on an agreement reached in 1999," said key creditor Seoul Guarantee Insurance.

A spokesman for the Samsung Group said it would "carefully study the documents and consider taking countermeasures at the court".




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