Court Approves Ssangyong Motor Resale... "Buyer Selection Around Late June"

Ssangyong Motor Pyeongtaek Plant Main Gate

[Asia Economy Reporter Choi Dae-yeol] Ssangyong Motor announced on the 14th that the Seoul Bankruptcy Court approved the 'reapplication for pre-approval merger and acquisition (M&A)' and other requests. The company decided to actively proceed with the resale process.

Previously, the company began the sale announcement in June last year and signed an investment agreement with the Edison Motors consortium in January this year through a public competitive bidding process. Subsequently, on February 25, the company submitted a rehabilitation plan and originally planned to hold a creditors' meeting on the 1st of this month to obtain approval from creditors and shareholders.

However, Edison Motors failed to deposit the acquisition funds by the deadline of the 25th of last month, resulting in the automatic termination of the investment contract. Following the Seoul Bankruptcy Court's decision to exclude the rehabilitation plan, the company moved to pursue resale.

Considering that the deadline for approval of the rehabilitation plan is October 15, the resale will proceed using a stalking horse method, where a conditional investment contract will be signed with a prospective buyer and the final buyer will be confirmed through a public bidding process. This is to expedite the schedule as much as possible. Given the multiple interested buyers and to ensure fairness in the procedure, the prospective buyer who will sign the conditional investment contract will be selected through a restricted competitive bidding process.

According to the company, the selection of candidates for the restricted competitive bidding will take place, and conditional acquisition proposals will be received and selected around mid-next month. The company plans to announce the sale in late next month, receive acquisition proposals by the end of June, and finalize the selection of the final buyer.

The company expects to sign the investment contract in early July and submit the rehabilitation plan by late July. The creditors' meeting and approval of the rehabilitation plan are anticipated around late August. Earlier, on the 7th, the Seoul Bankruptcy Court extended the approval period for Ssangyong Motor's rehabilitation plan to October 15.

Jung Yong-won, the administrator of Ssangyong Motor, stated, "The Seoul Bankruptcy Court's approval for the resale and extension of the rehabilitation plan approval period confirms that there are no procedural issues with the resale process." He added, "Since there are multiple interested buyers, we will proceed with the resale process as quickly as possible." He further commented, "Edison Motors' continued baseless litigation is a clear obstruction of business, and if they have the intention and capability to acquire, they should participate in the resale process accordingly."