[Photo by Lee Seung-hwan]
SsangYong Motor goes under court-led restructuring upon a go-ahead from main creditor and state lender Korea Development Bank (KDB) as it more or less gave up on an outside investor in place of its Indian parent planning phase-out from the Korean market.
According to financial industry sources on Tuesday, the Seoul bankruptcy court is waiting for responses from SsangYong Motor creditors on initiating the court-led restructuring for the carmaker. They were asked if they consent to its choice of manager and auditors.
KDB is internally decided on the court-led restructuring due to stalemated search for investor by the carmaker.
California-based car importer HAAH Automotive Holdings did not answer to the court by the end of March, returning the SUV-focused carmaker back to the court for the second time since 2009.
The court will likely command the carmaker later this week.
SsangYong Motor President & CEO Yea Byung-tae will likely stay as the manager. The court recommended his management, although the union is opposed.
Even under court management, SsangYong must find new investor for a turnaround. Considering HAAH Automotive’s earlier investment plan of 280 billion won ($250 million), the investor would be capable of injecting 200-300 billion won in cash.
“Currently about three companies are reportedly showing interest in SsangYong. If the automaker’s liabilities become lighter through the restructuring, a new investor will likely come forward,” said an expert from the financial industry.
[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]