SEOUL, Oct. 20 (Yonhap) — A South Korean consortium led by local electric carmaker Edison Motors Co. has been recommended as the preferred bidder to acquire SsangYong Motor Co., the company said Wednesday.
“SsangYong Motor’s court-appointed manager has recommended the Edison Motors consortium as the preferred bidder for the carmaker. Another local consortium led by EV firm Electrical Life Business and Technology (EL B&T) was excluded from the court’s reviewing process due to lack of required documents,” a SsangYong Motor spokesman said over the phone.
According to the spokesman, SsangYong plans to submit an official document for the selection of the Edison consortium for the debt-laden carmaker within a week, and the Seoul Bankruptcy Court will announce the preferred bidder.
Once the preferred bidder is selected, SsangYong and EY Hanyoung plan to conduct a two-week due diligence on the bidders in October and sign a deal in November.
It is estimated up to 1 trillion won is needed to take over the debt-laden SsangYong.
In April, SsangYong was placed under court receivership for the second time after undergoing the same process a decade earlier. Its Indian parent Mahindra & Mahindra Ltd. failed to attract an investor due to the prolonged COVID-19 pandemic and its worsening financial status.
Court receivership is one step short of bankruptcy in South Korea’s legal system. In receivership, the court will decide whether and how to revive the company.