General Motors on Wednesday said it has offered to purchase the car assembly unit of Daewoo India to manufacture mini cars for the country and the due diligence process for the deal would start immediately.

"Our offer has been accepted by the principal creditors of the Surajpur-based Daewoo Motors India Ltd and we shall start the due diligence immediately to arrive at the price to be offered by us," P Balendran, vice president of General Motors India, told PTI in New Delhi.

The creditors of DMIL include ICICI Bank, IDBI and Exim Bank, Balendran said, adding that purchasing the car assembly unit of Daewoo Motors would be subject to approval of the respective boards of General Motors, the creditors and judicial and government authorities.

"Pursuant to such sale, General Motors would purchase 100 per cent of DMIL's car assembly assets," Balendran said.

Commenting on the development, Kalpana Morparia, deputy managing director of ICICI Bank, said, "Today's development represents a significant milestone for the automobile industry in India. It sends a powerful message that India is a good place to invest and good place to do business."

In a statement issued in Singapore, F A Henderson, GM Group vice president and president of GM Asia Pacific, said: "This facility will allow us to produce a new generation of cost-competitive vehicles that can be marketed through our Chevrolet distribution channel."

Balendran said a team for due diligence would come from abroad and it would be assisted by Indian officials.

"On completion of due diligence, definitive agreements would be signed between General Motors and the principal creditors," he added.

According to sources, DMIL's creditors were looking for a buyer for the last two years to recover upto $287 million owed by the South Korean industrial group.

GM's investments in India include operations of GM India, its vehicle manufacturing plant at Halol in Gujarat and the new GM Engineering Centre in Bangalore, the company release said.