South Korea is willing to grant tax breaks to General Motors if the U.S. auto giant includes an aging plant of bankrupt Daewoo Motor in its takeover package. But talks appear unlikely to be concluded this month.
An official in Inchon city where the Pupyong plant is located said he hopes GM will also take on all employees of the factory.
He declined to specify which taxes would be involved and the extent of any tax incentives which might be offered to GM.
Meanwhile, the chairman of the Financial Supervisory Commission said takeover negotiations with GM are at the initial stage, so GM and Daewoo creditors are unlikely to come to an agreement by the end of this month.
The Pupyong plant is Daewoo's largest and oldest production line. The plant located west of Seoul employs seven thousand workers.
Daewoo laid off more than one thousand seven hundred workers at the assembly line at Pupyong earlier this year to pave the way for the company's sale to GM.
But Korea's push to get GM to agree to include Pupyong in any takeover package has been dogged by questions about its financial viability as well as concerns about labor unrest.