Ssangyong Motor, Will Revival and Normalization Accelerate... Sale Advisor to Be Selected Early Next Month

[Image source=Yonhap News]

[Asia Economy Reporter Ki-min Lee] Ssangyong Motor, which is undergoing corporate rehabilitation procedures, plans to select a sale lead manager in early next month and accelerate the sales process and normalization.

According to the industry on the 30th, Ssangyong Motor is scheduled to select a sale lead manager in early next month and officially start the sales work. Previously, Ssangyong Motor held presentations for selecting the sale lead manager until the 29th. Currently, Mirae Asset Securities and Han Young Accounting Corporation are competing to become the sale lead manager.

Once the sale lead manager is selected, Ssangyong Motor plans to announce the bidding and intensify the sales work. From next month, through the sale lead manager, 4 to 5 companies that have expressed acquisition intentions will be shortlisted for due diligence, and based on the letters of intent submitted by them, a preferred negotiation partner will be selected.

Currently, companies that have officially expressed acquisition intentions to Ssangyong Motor include the U.S. HAAH Automotive, which was the previous preferred negotiation partner, domestic electric bus manufacturer Edison Motors, electric vehicle company K-pop Motors, and private equity firm Park Seok-jeon & Company. It is also known that there are several acquisition companies that have been reluctant to disclose their identities so far.

A detailed investigation report including the sale amount and going concern value will be submitted to the court, and Ssangyong Motor will also negotiate with the labor union to submit a rehabilitation plan to the court by July 1. The industry expects Ssangyong Motor to select a preferred negotiation partner by the end of September and proceed with price negotiations. The industry anticipates that the sale price will be formed around the 280 billion to 300 billion KRW level that HAAH intended to invest.

However, considering the scale of Ssangyong Motor’s bonds and the enormous sales and development costs required until the company is normalized, there is a possibility that the rehabilitation procedure period may be prolonged due to the investment amount. As of the end of last year, Ssangyong Motor’s public interest bond scale was about 370 billion KRW. In addition, it is known that the rehabilitation bond amount reported by creditors to the court exceeds the level originally expected by Ssangyong Motor.

Moreover, Ssangyong Motor plans to produce the first electric vehicle of this year, the Korando e-Motion (project name E100), followed by the new mid-size sport utility vehicle (SUV) J100 next year. On the 24th, Ssangyong Motor submitted an application to the court requesting approval for payment of construction costs to equip the production facilities for the J100.

An industry official said, "For the prompt sale and corporate normalization of Ssangyong Motor, it is crucial that companies with financial power and sales networks participate in the bidding," adding, "Although Ssangyong Motor is making efforts to reduce costs on its own, it seems inevitable that it will have to proceed with workforce restructuring in the end."

This content was produced with the assistance of AI translation services.