The reports all quoted senior Daewoo and government officials, but none was available for comment on Saturday.

The reports said the group, whose 41 affiliates made a combined net loss of 55.4 billion ($46.8 million) on total sales of 61.72 trillion won in 1998, faced tightening liquidity.

The Maeil said it would retain only car-maker Daewoo Motor Co, trading and construction firmDaewoo Corp and shipbuilding and heavy machinery firm Daewoo Heavy Industries Co.

The group has said it cut the number of affiliates to 23 by the end of June and would slash that number to nine by year-end.If confirmed, the plan would be the most drastic ever reform announced by any of the country's highly leveraged chaebol -- family-run business conglomerates engaged in a wide range of business lines, including some that are far from profitable.

President Kim Dae-jung's government, under support and guidance from the International Monetary Fund, has told each of the top chaebol to streamline operations and refocus them on a few core, profitable sectors.

A severe Financial crisis in mid-1997 had put what was the world's 11th-largest economy on brink of a debt default and forced it to accept a $58.35 billion bailout from the IMF.In return for the funds, South Korea agreed to pursue a corporate restructuring drive which aimed to nurse balance sheets back to health and tackle industrialover-capacity.Analysts say most chaebol have dragged their feet on their own reform pledges and warned that further delays could rob the nation's economic recovery of momentum.

South Korea's economy, which contracted by 5.8 per cent last year, is bouncing back dramatically with official and independent forecasts of five to seven per cent growth this year.