Ssangyong Motor Applies to Court for Termination of Rehabilitation Proceedings

Early Graduation from Rehabilitation Expected as Soon as Next Month

[Asia Economy Reporter Kiho Sung] Ssangyong Motor is expected to complete its corporate rehabilitation process as early as next month.

Ssangyong Motor announced on the 31st that it has filed an application to terminate the rehabilitation process with the Seoul Bankruptcy Court. Ssangyong Motor explained the reason for the termination application, stating, "We are faithfully carrying out all procedures according to the rehabilitation plan, and there are no reasons that would hinder the execution of the rehabilitation plan."

Ssangyong Motor applied to the court for the commencement of rehabilitation proceedings on December 21, 2020, and received the court's decision to start the process on April 15 of last year. During the rehabilitation process, Edison Motors emerged as the preferred bidder for the M&A (mergers and acquisitions), but the contract was terminated as Edison Motors failed to pay the remaining acquisition funds.

Subsequently, Ssangyong Motor selected the KG Consortium as the prospective acquirer, and in August, the court approved the rehabilitation plan, confirming the KG Consortium as the final acquirer. The KG Consortium paid 365.5 billion KRW for the acquisition and has also completed payment of 571 billion KRW for the capital increase. KG Mobility holds a 66.12% stake.

Based on the acquisition funds, Ssangyong Motor repaid 351.6 billion KRW out of the total bond amount of 351.7 billion KRW.

Once the court decides to terminate Ssangyong Motor's corporate rehabilitation process, Ssangyong Motor will graduate from court receivership for the second time. Ssangyong Motor also completed the rehabilitation process when it was acquired by Mahindra in March 2011.

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