Seoul - South Korea's Hyosung Group on Thursday withdrew its offer to buy a 28-per-cent stake in chip manufacturer Hynix Semiconductor Inc.

The group's Hyosung Corp said it abandoned its bid for Hynix due to "various unfounded rumours including those suggesting government favour for our bid have made it difficult for us to seek a fair takeover," the news agency Yonhap reported.

Hyosung Group, which is active in chemicals, textiles, industrial systems and trading, said in a letter of intent in September that it wanted to purchase a 28.07-per-cent stake in Hynix.

South Korean media reported at the time that the company was the only one interested in buying the stake from the banks who are the creditors and at the same time part-owners of Hynix.

The purchase of the 28.07-per-cent stake would have made Hyosung the largest shareholder in Hynix, the world's second-largest memory chip manufacturer.

Hynix's largest creditor, the Korea Exchange Bank, said it would meet the company's other creditors and put the stake out for tender again.

Analysts, however, said they doubted that the bidding could take place soon or that there would be interest in it.

Hynix was saved from collapse by the banks eight years ago when the price of some memory chips collapsed.

In 2005, the company was released from its creditors' control, and the money they lent it was turned into shareholdings. (dpa)