While the Edison Motors Consortium’s takeover of Ssangyong Motor failed, Ssangyong Motor started to contact new buyers.
As there is not much time until October 15, the deadline for legal approval of the rehabilitation plan, it plans to review various methods such as private contracts and stalking horses as well as competitive bidding methods. A stalking horse is a method in which a rehabilitated company enters into a conditional acquisition contract with an intentional bidder on the premise of an open bidding.
According to multiple officials on the 29th, Ssangyong Motor’s court manager Jeong Yong-won and commercial creditors had a meeting this morning to discuss ways to cancel the Edison Motors M&A contract and re-sell it.
At this meeting, the manager explained that although nothing has been visualized so far, he has started contacting those who are intending to take over. It is known that the manager did not disclose the intention to take over at this meeting.
An official from the creditors said, “As Edison Motors is taking legal action, such as applying for an injunction, it is expected that they will make contact under the water and find a new buyer in earnest following April.”
The court decides to exclude the rehabilitation plan, cancels the assembly of related persons
According to Ssangyong Motor, the Seoul Rehabilitation Court ruled on the same day that the rehabilitation plan prepared on the premise of a merger and acquisition (M&A) with the Edison Motors consortium was excluded. The meeting of related people scheduled for the 1st of next month has also been canceled.
The court is planning to notify creditors and shareholders of the cancellation of the assembly of related persons for the review and resolution of the rehabilitation plan, which was scheduled to be held on the 1st of next month. The deadline for submitting the rehabilitation plan has been extended to May 1.
This is a follow-up measure following Ssangyong Motor canceled the M&A investment contract on the 28th due to Edison Motors’ non-payment of the remaining acquisition price within the due date.
On the 28th, Ssangyong Motor submitted an investigation report to the court stating that Edison failed to pay the balance of the acquisition price and that the existing rehabilitation plan was not feasible. The existing rehabilitation plan included a plan to repay existing rehabilitation bonds within the next month with the purchase price paid by Edison Motors.
◆Edison files for injunction… Ssangyong responds to “Edison’s fault”
Ssangyong Motor announced on the 28th that “the M&A investment contract signed with the Edison Motors consortium has been automatically canceled.” On the same day, Edison applied to the court for an injunction, including the suspension of the contract cancellation effect. Edison requested that the notification of cancellation of the investment contract be suspended until a judgment on the merits of the lawsuit is finalized through an injunction and that the withdrawal of 30.5 billion won paid as a down payment be prohibited.
The M&A investment contract between Ssangyong Motor and Edison signed on January 10 stipulated that ‘Edison Motors must complete the payment of the acquisition price 5 business days before the meeting of related parties, and if this is not fulfilled, the contract will be terminated immediately’. Edison had to pay the remaining 274.3 billion won, excluding the previously paid down payment of 30.5 billion won, by the 25th (five business days before the meeting of related parties), but did not deposit it.
Regarding Edison’s application for injunction, Ssangyong Motor said on the 29th, “As the reason for the cancellation of the contract is clearly attributable to Edison Motors, we will clarify this through a lawsuit.”
“As the M&A investment contract was canceled due to the non-payment of the balance of the acquisition price of Edison Motors, and the rehabilitation plan was excluded by the court, we plan to proceed with the sale process once more to promote a competitive M&A,” he said.
“It is judged that there will be competitive takeover candidates according to the improvement in corporate value, such as the removal of a significant amount of opacity on major management issues,” he said.
◆More than 10,000 units have been produced since July… Commercial creditors “supply parts without setbacks”
Meanwhile, when the new electric car J100 is released at the end of June, Ssangyong Motor plans to increase the current production system from producing 8,000 to 9,000 units per month to 2 shifts per week without paid leave to 12,000 units through unpaid leave.
The creditors of Ssangyong’s commerce business also decided to add power to the normalization of Ssangyong by supplying parts without any setbacks.
An official from the creditors said, “After the launch of a new car, if we increase the number of units produced through normalization of work and increase the company’s value through normal management, we expect to find a new buyer. It has been verified that it should be done,” he explained.
[서울=뉴시스]
