[Asia Economy Reporter Yoo Hyun-seok] The court has accepted Ssangyong Motor's application and selected the KG Group consortium as the new prospective owner. Since the process will proceed through a limited competitive bidding method, a conditional acquisition contract is expected to be signed first.
On the previous day, Ssangyong Motor and the sales lead manager EY Han Young Accounting Corporation announced that, with the court's approval, the KG consortium was selected as the prospective acquirer before the M&A announcement.
Ssangyong Motor and EY Han Young Accounting Corporation comprehensively evaluated factors such as ▲the size of the acquisition price ▲the ratio of paid-in capital increase and required shareholding ▲plans to secure operating funds after acquisition (scale and method of procurement) ▲and the employment guarantee period to select the prospective acquirer before the announcement.
With the selection of the preferred acquirer, Han Young Accounting Corporation, the sales lead manager for Ssangyong Motor, plans to sign a conditional investment contract with the KG consortium next week. They will then announce the public bidding. The Ssangyong Motor acquisition will be conducted using the stalking horse method. The stalking horse method involves signing a conditional investment contract with a prospective acquirer, but if a candidate offers better terms during the subsequent public bidding, the final acquirer can change. If no bidder offers a higher price than the KG Group consortium's bid in the main bidding, they will be confirmed as the final acquisition candidate.
However, the Kwanglim consortium is currently disputing the selection of the prospective acquirer. On the previous day, the Kwanglim consortium issued a statement saying, “Article 19, Paragraph 1, Item 8 of the Fair Trade Act concerning bid rigging protects not only competition in the bidding itself but also competition in the process leading to the bidding,” and argued, “If the winning bidder was predetermined by an agreement among businesses, causing non-winning bidders to forgo participation in the bidding itself, it completely eliminates the possibility of competition functioning in advance.”
They continued, “The M&A acquisition condition proposal guide provided by the sales lead manager Han Young Accounting Corporation also contains provisions to prevent such unfair competition,” and emphasized, “We will file an injunction with the court regarding the selection of the KG-Pavilion alliance.”
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