Kang Young-kwon, Edison Motors Chairman: "Accelerating the Transition to Eco-Friendly Vehicles"
[Asia Economy reporters Changhwan Lee and Gimin Lee] Edison Motors, which is likely to become the new owner of Ssangyong Motor, has unveiled a vision to transform the renowned SUV (sports utility vehicle) brand into an eco-friendly car brand, starting with the launch of 10 electric vehicles next year.
Kang Young-kwon, chairman of Edison Motors (pictured), said in an interview with Asia Economy on the 21st, "We will revive Ssangyong Motor based on the technology and investment funds accumulated through our expertise in electric bus production," adding, "We will develop electric vehicles with excellent design, quality, and price competitiveness to make Ssangyong a future car company that can compete with global automakers such as Tesla and GM."
Ssangyong Motor announced the day before, "Ssangyong Motor and the sales lead manager EY Han Young Accounting Corporation have selected the Edison Motors consortium as the preferred bidder and plan to apply for court approval."
Edison Motors is a company that produces compressed natural gas (CNG) buses, electric buses, and electric trucks. It participated in this bid by forming a consortium with private equity fund KCGI and Keystone Private Equity (PE).
Chairman Kang plans to accelerate the launch of eco-friendly vehicles such as electric and hybrid cars starting next year. They plan to release 10 electric vehicle models, including sedans and SUVs, next year, 20 models by 2025, and 30 new electric vehicles by 2030.
The key issue is securing large-scale funding. Ssangyong Motor’s current debt, including public bonds, is known to be around 700 billion to 1 trillion KRW. In addition to repaying the debt, at least 1 trillion KRW or more in additional investment funds will be needed for future electric vehicle production and development.
Edison Motors currently has about 270 billion KRW in self-raised funds and is reported to have secured an additional investment of about 400 billion KRW from financial investors.
Chairman Kang explained that they can raise several hundred billion KRW more by attracting institutional and overseas investors and through rights offerings. He also noted that since the land value of Ssangyong Motor’s Pyeongtaek plant is high, additional loans could be secured using it as collateral.
Ssangyong Motor and EY Han Young Accounting Corporation plan to sign a memorandum of understanding (MOU) with Edison Motors by the end of this month after the court approval process for selecting the preferred bidder. Then, they will conduct a detailed due diligence for about two weeks in early next month and continue negotiations on the acquisition price and key contract terms. If the schedule proceeds smoothly, the final contract signing is expected by the end of next month.
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