Cash-strapped SsangYong, the maker of decent utes and SUVs with an Australian subsidiary operation, has reportedly found a keen buyer.
Reporting from Korea Bizwire say the Seoul Bankruptcy Court administrator has selected a consortium led by Korean electric bus-maker Edison Motors Co.
“SsangYong and its lead manager have recommended the Edison Motors consortium as the preferred bidder for the carmaker,” a SsangYong Motor spokesman was quoted as saying.
The Edison-led consortium will reportedly conduct a final two-week due diligence on SsangYong in November and then sign a deal to acquire it.
The Korea Herald added that Edison Motors’ consortium includes homegrown activist fund Korea Corporate Governance Improvement, Keystone Private Equity and electric vehicle component maker Semisysco.
The Edison consortium says it’s setting up a special purpose company to raise between 800 billion and 1 trillion won (A$905 million to $1.13 billion) to acquire SsangYong. It’s estimated up to 1 trillion won is needed to take over SsangYong due to its massive amounts of debt.
It then plans to increase capital by issuing new shares next year, with the aim of getting the company back in the black within 3-5 years.
Kang Young-kwon, chief executive officer of Edison Motors, said previously in an interview with same publication that he wanted to transform SsangYong into an EV brand to rival Tesla, Volkswagen and General Motors.
“Edison Motor’s battery technology would benefit SsangYong to produce more competent electric vehicles,” Mr Kang added.
The consortium reportedly has ambitious plans to produce 10 new EV models by 2022, 20 by 2025, and 30 by 2030. Those lofty numbers suggest it’s referring to individual variants and not model lines.
Cardinal One Motors, headed by CEO Duke Hale who helmed HAAH Automotive Holdings, had spoken publicly of plans to import SsangYongs into the lucrative North American market, in which the brand has never been sold.
These plans had been suggested after plans to import and sell Chinese Chery models had fallen through.
The three bidders have stepped up after SsangYong’s owner, Mahindra & Mahindra, confirmed it was looking to sell the company in April 2020. The Indian company currently has a 74.65 per cent stake in it.
SsangYong was placed into court receivership in April 2021, one step short of bankruptcy in the South Korean legal system.
SsangYong has battled through its woes to show strong growth with its diesel and petrol range comprising the Musso Ute, and the Korando and Rexton SUVs. It’s sold 2189 this year, up 104 per cent.