Ssangyong Motor Main Bidding Begins... KG Consortium vs Ssangbangwool Competition (Comprehensive)

Ssangyong Motor Stalking Horse Procedure Initiated
Letter of Intent Submission Deadline June 9
Gwanglim Expresses Intention to Participate in Main Bidding

[Image source=Yonhap News]

[Asia Economy Reporter Hwang Yoon-joo] As the sale of Ssangyong Motor officially begins, the competition for acquisition has heated up. With the KG Consortium selected as the prospective buyer, a sale announcement was made, but Kwanglim has expressed its intention to participate in the main bidding. The competition between the two sides is expected to be a battle of financial strength.

On the 31st, Ssangyong Motor announced that it will proceed with a public competitive bidding process with a stalking horse method, where a prospective buyer is already designated. Letters of Intent (LOI) will be accepted from the 2nd to 3 PM on the 9th of next month, and acquisition proposals until 3 PM on the 24th of the same month. On the proposal deadline, bidders must submit their bid prices and business plans.

Even before the LOI deadline ended, as soon as the public sale announcement was made, the curtain rose on a fierce competition. Ssangbangwool Group announced its intention to participate in the main bidding along with the announcement.

A representative of Ssangbangwool Group said, "The Kwanglim Consortium plans to participate in the main bidding as scheduled," adding, "Based on our experience with the Eastar Jet public bidding, we are preparing diligently to achieve good results."

Previously, Ssangbangwool Group competed with the KG Consortium in the stalking horse prospective buyer selection process but was defeated. The stalking horse method involves selecting a prospective buyer first and then conducting the main bidding. If a better offer emerges during the main bidding, the final buyer can change.

Ultimately, the key to this acquisition battle is expected to be financial capability. In the main bidding, if the prospective buyer (Ssangbangwool Group) makes a bid, the designated buyer (KG Consortium) can accept that bid and decide whether to participate in the main bidding. The designated buyer essentially holds the right of first refusal.

[Image source=Yonhap News]

In particular, the final buyer will need to make significant investments to normalize Ssangyong Motor’s management. The success of the new car ‘J100’ scheduled for release next month and responding to the electric vehicle market are also considered major investment tasks.

The KG Consortium has expressed confidence in this regard. They believe that the buyer must have strong cash financial strength. KG Group is reported to have secured about 860 billion KRW by combining cash and cash equivalents held by KG Chemical and the proceeds from the sale of the environmental energy business unit of KG ETS. They especially emphasized that a company interested in the automotive industry should be the buyer. A KG Consortium official said, "The Ssangyong Motor plant is a forward base for making cars," adding, "A company interested only in the real estate owned by Ssangyong Motor or someone trying to acquire it through borrowing should not become the owner of Ssangyong Motor."

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