Ssangyong Motor’s Pyeongtaek Factory Factory Office that applied for corporate rehabilitation procedures on the 21st. News 1
– Ssangyong Motor had two months to save new investors and adjust the maturity of loans with the financial sector.
According to law enforcement officials on the 28th, the Seoul Rehabilitation Court accepted the ARS program requested by Ssangyong Motors and held the decision to commence court management until the end of February next year. An official of Ssangyong Motors said, “The ARS period is not specifically fixed,” and “There are cases that have been extended after 3 months.”
In the face of a liquidity crisis, Ssangyong Motors applied for a self-structuring support (ARS) program to the court along with corporate rehabilitation procedures (legal management). As the court accepted Ssangyong Motor’s ARS program on that day, Ssangyong Motor may not enter the rehabilitation process if it secures new investors through consultations with creditors and major shareholders and extends the maturity of loans in the financial sector. According to industry sources, Ssangyong Motor and the Indian Mahindra Group, the largest shareholder, are negotiating investments with the US automobile retailer HAAH Automotive.
Earlier, on the 21st, Ssangyong Motors applied for court management to the Seoul Rehabilitation Court when it was unable to repay the 157.5 billion won in loans from foreign financial institutions and Korea Development Bank. The loan principal and interest amounting to about 255.3 billion won has been overdue to long-term borrowings.
Ssangyong Motor’s Pyeongtaek plant has been stopped since the 24th in the aftermath of the legal management application. When it was announced that they had applied for legal management, five major suppliers, including Hyundai Mobis, requested cash payments instead of bills, and stopped supplying parts to Ssangyong Motors. Since then, Hyundai Mobis and S&T Heavy Industries have announced that they will resume, but LG Hausys, Borg Warner Ochang, and Continental Automotive are still sticking to the impossible position. An official from Ssangyong Motors said, “We are in discussions with the rest of our partners to resume supply of parts,” and said, “It is unclear whether the factory will resume on the 29th.”
Reporter Kim Young-joo [email protected]
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