Nine bids received for SsangYong Motor by deadline
"Many companies that have submitted the letters are doing so with a goal of expanding their electric vehicle businesses,” SsangYong Motor said in a statement.
It did not disclose the names of the bidders, but two Korean companies confirmed that they are seeking to buy the debt-laden company.
Samra Midas (SM) Group, a diversified conglomerate with interests ranging from manufacturing to shipping, said it has expressed interest.
“We anticipate that SM Group’s auto parts makers SM Namsun Aluminum and SM Hwajin can create synergy effects with SsangYong Motor,” said a spokesperson for SM Group on Friday.
SM Group had expressed interest in acquiring SsangYong in 2010 when the company was last up for sale.
Gangnam’s Kpop Motors, a maker of electric minicars, also said it is in the race to take control of SsangYong Motor.
“Cash reserves are the key factor in purchasing SsangYong Motor,” said Hwang Yo-seob, CEO of Kpop Motors. “A complete revival of the company would take 3.8 trillion won [3.3 billion won], and we have raised around 380 billion won so far.”
Edison Motors, an electric bus maker, and Park Seok-jeon & Company, a local private equity fund, have been identified in local press reports as bidders for the company.
Edison Motors has reportedly joined forces with the Keystone Private Equity to buy SsangYong Motor.
A foreign company also made an offer, according to press reports.
Delaware-based Cardinal One Motors has submitted a bid. HAAH Automotive Holdings founder Duke Hale recently established the company with the aim of shifting focus away from the business of importing Chinese vehicles.
SsangYong Motor has been in receivership since April. In Korea, receivership is a step short of bankruptcy and involves a court-led workout.
The successful buyer is expected to pay about 1 trillion won to acquire the Korean automaker and invest another 2 trillion won to 3 trillion won in the company.
Market analysts say abundant cash reserves would be the key to decide who becomes the new owner of SsangYong Motor.
Ernst & Young Han Young, which is administering the receivership, will conduct preliminary reviews in August. Preferred bidders will be selected by the end of September and price negotiations will be completed by end of October. The successful buyer is expected to sign the deal in November.
SsangYong Motor recently announced that it is selling its 850,000-square-meter (9.15 million-square-foot) Pyeongtaek factory, its only facility for auto assembly. The factory was recently valued at 900 billion won, and its sale is expected to provide funds for the carmaker to build a factory for the development of new vehicles.
BY SARAH CHEA, KANG KI-HEON [firstname.lastname@example.org]