KG consortium chosen as final SsangYong Motor bidder
The Seoul Bankruptcy Court said Tuesday it approved SsangYong Motor's application to name the KG consortium the final bidder.
KG Mobility-led consortium includes KG ETS, KG Steel, KG Inicis, KG Mobilians, Cactus Private Equity and Pavilion Private Equity. It submitted a 900 billion won ($700 million) bid, including 336 billion won for the acquisition price.
KG Mobility is 100 percent owned by KG ETS, which was established on May 11.
Another consortium led by Kanglim bid 1.1 trillion won, even larger than the KG consortium, but was ruled out after a review of their "plans on how to raise the fund, and financial status," the Seoul Bankruptcy Court said Tuesday.
"We and the deal manager do not just take seriously the bidding price, but also the other factors such as the validity of the funding and how the company would fund that money," SsangYong Motor said in a statement.
The debt-laden carmaker also said the decision was made to avoid repeating past failures. Earlier in the year, the acquisition of SsangYong by a local consortium led by Edison Motors fell apart as the Korean electric bus manufacturer couldn't pay up.
SsangYong Motor is expected to sign a deal with the KG consortium next month and submit its rehabilitation plan to the Seoul Bankruptcy Court by the end of August. It has until Oct. 15 to finish the process or else the court declares the company bankrupt.
KG ETS is an energy company that is 47 percent owned by KG Chemical. It is listed on the Korea Exchange as a Kosdaq constituent.
KG Chemical traces its roots back to Gyeonggi Chemical, established in 1954 as Korea's first fertilizer manufacturer. Gyeonggi Chemical is now called KG Chemical.
Last week, KG ETS sold its environment, energy and new material businesses to E&F Diamond Holdings for 495.8 billion won.
BY SARAH CHEA [email@example.com]