Kia Motors Auction Again Foiled

The auction of Kia Motors Corp., an insolvent South Korean auto maker, was scrapped for the second time in a month after creditors refused debt write-offs demanded by the bidders, a Kia spokesman said Wednesday.

The failed attempt to sell the company appears to reopen the door to Ford Motor Co. to rejoin the suitors. Ford had dropped out of the second round after Kia’s creditors refused to sweeten the pot by writing off more of the company’s debt.

But when Hyundai Motor Co., Daewoo Motor Co. and Samsung Motors Inc. bid a second time for Kia, they continued to demand bigger write-offs than the $2.1 billion promised last week.

A Ford spokesman said the company, which already controls a 17% interest in Kia, would like to rejoin the auction if assurances are made that a bigger debt write-off will be offered.

A successful sale of Kia Motors is seen as vital to the government’s drive to make conglomerates streamline their marginal businesses to overcome the country’s deepest recession in 45 years.

Meanwhile, officials at Kia’s U.S. headquarters in Irvine remain on edge, waiting to find out who will be calling the tune as they continue increasing sales and moving into new markets here.