Lee Dong-geol: "Edison Motors, Let a Third Party Verify Ssangyong Motor's Development Plan"

Ssangyong Motor Revival... Sustainable Management Plan is Top Priority
Doosan Group Has Not Graduated from Restructuring Yet... "Additional Financial Structure Improvement Needed"
HMM's Phased Sale Plan... "Will Consult with Government"

Chairman Lee Dong-geol of Korea Development Bank speaking at an online press conference on the 30th.

[Asia Economy Reporter Kim Jin-ho] Lee Dong-geol, Chairman of the Korea Development Bank (KDB), proposed on the 30th that Edison Motors, which is attempting to acquire Ssangyong Motor, "needs to have its development strategy verified by a third-party institution."

At an online press conference held that day, Chairman Lee said, "Various doubts have been raised about Edison Motors from multiple sources," adding, "I think it is necessary to dispel these doubts."

He stated, "If Ssangyong Motor's development strategy is judged impossible by a third-party institution, then regardless of administrative procedures such as approval of the rehabilitation plan, putting money in would be futile, right? Whether it is Edison’s money or KDB’s money, in an impossible situation, the development strategy will either have to be redrafted or abandoned."

He added, "I advise that it would be good to receive an objective evaluation of the technical and financial feasibility through a third-party institution."

When asked if there is a support plan if Edison Motors requests a loan from KDB, he replied, "We have not received such a request," but added, "I have seen media reports stating that Edison Motors has no problem securing acquisition and operating funds without KDB loans, so I hope the process proceeds well without KDB support."

Chairman Lee emphasized, "If they want KDB’s support, having a sustainable business plan is most important," and added, "Our position remains that support is difficult if the plan is not feasible." He further noted, "The collateral emphasized by Edison Motors is not very meaningful. They are not going to reclaim land to build and sell apartments; verifying the capability for business rehabilitation is the top priority."

Regarding the possibility of Doosan Group completing its restructuring within this year, he responded, "Further financial structure improvement is necessary." He said, "Although Doosan Group has been implementing its self-help plan, the sale of Doosan Construction did not contribute significantly to improving the financial structure," and added, "If the financial structure improvement efforts led by Doosan Group, including the planned rights offering to be completed early next year, proceed as planned, we will conduct a comprehensive review after an external financial diagnosis."

About Doosan Group, Chairman Lee urged, "Please do not lose the sense of urgency to enhance sustainability," and added, "Please focus your capabilities on completing eco-friendly renewable technologies such as gas turbines, large-scale wind power, and hydrogen."

Regarding the progress of the integration process between Korean Air and Asiana Airlines, he said, "The corporate merger reviews by competition authorities in each country are ongoing, and since approval has not been finalized, the full integration process has not proceeded, which is regrettable."

He expressed regret over the possibility of conditional approval during the corporate merger review process, such as orders to sell routes due to monopoly concerns. He said, "If excessive reductions in transportation rights are imposed to the extent that the company’s future competitiveness is impaired, it could be very difficult," and added, "Since this could disrupt the synergy creation plan for the integration, we expect appropriate measures."

When asked about the sale of HMM’s shares, he was reserved, saying, "This is an issue to be finalized through consultations with the Ministry of Oceans and Fisheries, the Financial Services Commission, and the Korea Ocean Business Corporation." Chairman Lee explained, "We (KDB) need to gradually withdraw, but we will discuss specific plans."

Regarding KDB’s business plan for next year, he stated, "We plan to promptly conclude restructuring issues and support the transition to a digital economy and the expansion of future growth engines through fostering innovative new industry companies." Chairman Lee said, "We will focus on ESG for carbon neutrality, sustainable management, and the Korean New Deal," and added, "Since the green economy is a global trend, we intend to make our industry a very important foundation to lead the global economy and maintain competitiveness."

Meanwhile, Chairman Lee said he expects the signing of the main contract related to the sale of Daewoo Construction to be "completed by the end of the year." Regarding the negative atmosphere surrounding the corporate merger review of Hyundai Heavy Industries and Daewoo Shipbuilding & Marine Engineering, he refrained from commenting, saying, "It is inappropriate to make premature judgments."