KG Mobility to Pursue Acquisition of Electric Bus Company Edison

Edison Enters Rehabilitation Process After Failing to Acquire Ssangyong Motor
KG "Sufficient Competitiveness in Electric Buses... Considering Overseas Expansion"

KG Mobility is set to acquire electric bus manufacturer Edison Motors. Edison Motors previously attempted to acquire SsangYong Motor, the predecessor of KG Mobility, but the deal fell through at the last minute due to failure to pay the remaining acquisition amount. Although Edison’s financial situation has deteriorated, the company possesses competitiveness in the electric bus business, and KG Mobility expects to revive it through its technological capabilities and KG Group’s expertise in mergers and acquisitions.

On the 26th, KG Mobility announced that it had been selected as the preferred negotiation partner for a conditional investment contract in the Edison Motors public notice by the rehabilitation court (Changwon District Court). Earlier, Edison had been undergoing a process to find investors after the court decided to initiate corporate rehabilitation proceedings in January this year.

KG Mobility exterior

KG Mobility submitted a letter of intent (LOI) for investment last month and conducted preliminary due diligence by the 14th of this month. On the 21st, it submitted a conditional investment acquisition proposal. Once the contract is finalized through an internal board meeting, KG Mobility will enter into a conditional investment contract with Edison Motors.

Based on the due diligence results, KG judged that Edison Motors has its own technological competitiveness, producing electric buses with a localization rate exceeding 85%. It also has a sales network, and KG believes there is sufficient potential for rehabilitation if competitiveness is enhanced.

KG also sees potential synergy from last month’s semi-knockdown (KD) contract with Kim Long Motor of the Vietnamese conglomerate Phu Ta Group. This company is engaged in automobile sales and passenger transport in Vietnam and plans to replace existing buses with electric buses. KG expects to enter overseas bus markets such as Southeast Asia.

KG Mobility stated, "We plan to leverage our expertise as an SUV-specialized company, our automotive technology capabilities, growth know-how, and successful corporate restructuring experience through rehabilitation procedures to develop Edison Motors into a company that contributes to the advancement of our society."

From the left in the photo are Jeong Yong-won, CEO of KG Mobility; Kwak Jae-sun, Chairman of KG Group; Nguyen Hu Luan, Chairman of Phu Ta Group; and Mai Phuoc Nguyen, President, posing for a commemorative photo after signing the KD contract last month.

Previously, SsangYong Motor underwent rehabilitation procedures in 2021, during which Edison Motors was selected as the preferred negotiation partner for a merger and acquisition. However, the contract was terminated because Edison failed to pay the full acquisition amount. Subsequently, a resale process was conducted, and last August, the KG consortium was confirmed as the final acquirer, completing the corporate rehabilitation procedure in November of the same year. Edison Motors’ financial condition rapidly worsened during the SsangYong acquisition process. Its management was arrested and prosecuted on charges of stock manipulation. The company has been undergoing related procedures since the court decided to initiate corporate rehabilitation proceedings in January.

This sale will proceed via a stalking horse method, where after selecting a preferred negotiation partner, a public bidding will be held once more, and if no candidate offers better terms than the existing one, the acquirer will be confirmed as is. Edison Motors was once considered a leading company with a domestic electric bus market share of around 30%, but it fell below 10% last year.

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