Ssangyong Motor to Close Letter of Intent Submissions by End of Month... Will a New Owner Be Found?

HAAH Founder Duke Hale: "Will Participate in Ssangyong Motor Acquisition with Newly Established Company"

[Image source=Yonhap News]

[Asia Economy Reporter Ki-min Lee] Ssangyong Motor, which is undergoing corporate rehabilitation procedures, is closing the submission of letters of intent for acquisition at the end of this month, and Cardinal One Motors, established by Duke Hale, chairman of the U.S. HAAH Automotive, a leading acquisition candidate, will participate in the acquisition battle.

According to the industry on the 25th, Ssangyong Motor plans to close the submission of letters of intent for mergers and acquisitions (M&A) at the end of this month. Afterwards, preliminary due diligence will be conducted from the 2nd to the 27th of next month for candidates who pass the screening among the hopeful acquirers, followed by receiving acquisition proposals, selecting a preferred negotiation partner, and proceeding with the main due diligence and investment contract steps.

Including public claims and post-acquisition investment costs, the actual funds required for acquiring Ssangyong Motor are expected to be in the range of 800 billion to 1 trillion KRW. Due to the high investment costs and the nature of the automobile industry requiring various sales networks, the market response is known to be lukewarm.

Besides HAAH, electric bus manufacturer Edison Motors, electric vehicle company K-Pop Motors, and Park Seok-jeon & Company, known as an affiliate of a private equity fund, have expressed intentions to acquire Ssangyong Motor.

Recently, as HAAH decided to liquidate, the sale of Ssangyong Motor fell into uncertainty, but with Chairman Hale, who founded HAAH, expressing his intention to acquire Ssangyong Motor again, there is growing expectation that the sale process will proceed smoothly.

Previously, HAAH had been reviewing the acquisition of Ssangyong Motor since last year as the preferred negotiation partner for the acquisition. However, the court initiated corporate rehabilitation (court receivership) procedures for Ssangyong Motor in April as HAAH continued to delay its investment decision.

Chairman Hale also stated in an interview with a media outlet that due to delays in the share reduction process by Mahindra, the major shareholder of Ssangyong Motor in India, there was insufficient time to make the investment decision, and he announced that he would submit the letter of intent for acquisition this week.

Chairman Hale explained that since conducting business through HAAH Automotive, the organization dedicated to Chinese business, could cause consumers to confuse Chinese brands with the Korean brand (Ssangyong Motor), he established an entirely new company, Cardinal One Motors.

He also plans to sell Ssangyong Motor’s sport utility vehicles (SUVs) and pickup trucks in the U.S. and Canada through Cardinal One Motors, which will be dedicated to business with Ssangyong Motor.

Chairman Hale said, "Based on global experience, I will support Ssangyong Motor," adding, "Ssangyong Motor can sell more Musso vehicles in one U.S. state than it sells globally." He has over 35 years of experience in the automotive business, having served as vice president at Volvo, Mazda, Jaguar, and Land Rover.

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