Kanglim to make an offer for SsangYong Motor

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Kanglim to make an offer for SsangYong Motor

Published: 01 Apr. 2022, 15:55 Updated: 01 Apr. 2022, 17:29

Logo of Ssangbangwool [SSANGBANGWOOL]

Kanglim, a Kosdaq-listed company that makes fire and tanker trucks, is bidding for SsangYong Motor after the wheels came off an acquisition by Edison Motors.

“We are actively looking into the acquisition and expressed our intent to the deal’s lead manager, EY Hanyoung, recently,” said a spokeswoman for Ssangbangwool, an underwear maker controlled by Kanglim, on Friday.

“We are planning on forming a consortium led by our affiliate Kanglim. We are going to submit a letter of intent some time next week."

Kanglim is the largest shareholder of Ssangbangwool, with a 12.4 percent stake.

The Kosdaq-listed Kanglim was founded in 1979 and acquired its stake in Ssangbangwool in 2014.

Ssangbangwool said it expects synergies between Kanglim and SsangYong Motor in electric vehicles if the acquisition goes through.

“Kanglim is co-developing electric powertrains for vehicles in partnership with U.S. startup Ridecell and we believe such a business will create synergies with SsangYong Motor.”

Edison Motors, the preferred bidder for the debt-laden automaker, was bailed out of its acquisition of SsangYong on March 28 by failing to pay 300 billion won ($247 million).

A rehabilitation plan based on the idea that Edison Motors, an electric bus manufacturer, would take over was nullified by the Seoul Bankruptcy Court on March 30.

SsangYong Motor said it was looking for a new buyer.

How Kanglim and Ssangbangwool will finance an acquisition is not known.

In 2021, a consortium lead by Ssangbangwool and Kanglim participated in a tender to acquire budget airline Easter. It reportedly bid 100 billion won, but lost to real estate developer Sung Jung.

“How we will come up with the financing, such as how seven of our affiliates will contribute to the acquisition price will be detailed in a letter of intent next week,” the spokeswoman said.

Stock prices of Ssangbangwool and Kanglim hit their daily upper limits during trading on Friday.

BY JIN EUN-SOO [jin.eunsoo@joongang.co.kr]