Edison Leading Ssangyong Motor Acquisition "Requesting Up to 800 Billion KRW Secured Loan from KDB"

"Applying Existing Ssangyong Models to Smart Platform... New Cars Possible Next Year"

[Asia Economy Reporter Yu Je-hoon] Edison Motors has predicted that acquiring Ssangyong Motor will cost up to 1.62 trillion KRW, and plans to secure up to 800 billion KRW of this amount through collateral loans from KDB Industrial Bank.

On the 22nd, Kang Young-kwon, chairman of Edison Motors, held an online press conference and stated, "We have requested the Industrial Bank to lend about 700 to 800 billion KRW using Ssangyong Motor's assets (Pyeongtaek plant) as collateral."

According to Chairman Kang, Edison Motors plans to raise 310 billion KRW of acquisition funds through the first round of paid-in capital increase together with consortium members Semisysco, Keystone Private Equity (PE), and KCGI. Subsequently, after the acquisition, they plan to raise the remaining costs through a second round of paid-in capital increase (490 to 530 billion KRW) and loans secured by Ssangyong Motor's assets (700 to 800 billion KRW).

Chairman Kang said, "Although a significant portion of Ssangyong Motor's debt will be repaid with the acquisition price of 310 billion KRW, there are still debts to be succeeded such as public bonds amounting to 700 to 800 billion KRW," adding, "Since Ssangyong Motor's assets are close to 2 trillion KRW, we requested a loan from the Industrial Bank based on this."

Regarding the possibility of the Industrial Bank refusing support, Chairman Kang said, "If the Industrial Bank properly listens to our rehabilitation plan and understands our technological capabilities, I believe they will naturally provide support," but also added, "If it fails, although the interest rate may be somewhat high, collateral loans through domestic commercial banks or Japanese and European banks are also possible."

Chairman Kang also emphasized Edison Motors' technological capabilities, seemingly aware of public perceptions that "the shrimp swallowed the whale." He said, "Edison Motors has already designed a smart vehicle platform, and by reverse engineering existing Ssangyong Motor models and integrating it, mass production of electric vehicles is possible by next year," adding, "While it is said that launching a new car typically costs 400 billion KRW, we have the technology to develop 3 to 5 models for 50 to 100 billion KRW."

Regarding future product lineups, he explained, "We will initially utilize Ssangyong Motor's existing bodies as they are and modernize the interior dashboards and seats," and added, "We also plan to reverse engineer and apply Edison Motors' smart platform to existing vehicles to sell them as electric vehicles."

Chairman Kang particularly emphasized, "Currently, Ssangyong Motor's electric vehicles have a maximum driving range of only 306 km per charge, but by replacing this with Edison Motors' smart platform, we can expand it to 450 to 550 km by June or July next year. For existing long-wheelbase models such as Chairman, Rexton, and Musso, it can reach 600 to 800 km with the smart platform applied," and reiterated, "Edison Motors is a company with world-class technology in the core fields of electric vehicles: motors, electronic control, and batteries."

Regarding future design strategies, Chairman Kang said, "There have been both failed and successful designs so far, but this is because professional managers, not owners, have been managing the company," and stated, "If we acquire Ssangyong Motor, an owner-manager with ownership like Steve Jobs or Elon Musk will directly manage the company to prevent such issues."