Seoul - Creditors of ailing Daewoo Electronics have chosen US equity firm Ripplewood Holdings as their preferred bidder after two failed attempts to sell South Korea's third-largest appliance and television maker, a South Korean bank said Wednesday.

Leading creditor Woori Bank said in Seoul that the takeover of Daewoo Electronics should be formalized by the end of this year.

New York-based Ripplewood will be granted access to Daewoo's books before the deal was signed, Woori Bank said, but declined to give details regarding the US company's offer.

Ripplewood was entering negotations with an offer of about 400 billon won, the national Yonhap news agency said, quoting industry sources.

Daewoo Electronic's creditors had originally hoped to sell the company for at least 1 trillion won. Ripplewood's bid beat a Russian consortium led by the company Digilant Systems.

Last year talks with a group of bidders led by Indian consumer electronics maker Videocon Industries failed, and in August an equities arm of US bank Morgan Stanley bailed out of exclusive takeover negotiations.

Until its break-up, Daewoo Electronics was part of the Daewoo Group, which collapsed in the late 1990s with debts of 80 billion dollars. The home appliances company has been under the control of its creditors since then. (dpa)