Ssangyong Is Now Seeking A New Buyer After Edison's Failure To Pay

• Edison motors failed to deliver the bulk of the payment to Ssangyong in time. 

• Ssangyong has been under court receivership since April 2021. 

• In Korea, the receivership lasts a year, but it can be extended by six months. 

• The carmaker will have until October 2022 to find another buyer.  

Reports suggest Ssangyong is looking for a new buyer after commercial electric vehicle (EV) manufacturer Edison failed to make the full payment for the acquisition. Mahindra had halted its investment out of Ssangyong in 2020. Since then, Ssangyong has been under court conservatorship – a form of judicial assistance just short of bankruptcy – in its home country. 

Edison had agreed in 2021 to acquire Ssangyong, and it had already paid 10 percent of the total amount, but the remaining 90 percent had to be secured by March. Since Edison was unable to pay by the deadline, the deal fell apart. 

Mahindra had invested in Ssangyong in 2011, and had acquired a majority 75 percent share by 2020. But factors such as the coronavirus pandemic had forced the Indian carmaker to reassess its investments, deals and joint ventures. 

Also read: 

• SsangYong Motors Company To Be Formally Acquired By Edison Motors 

• Carmakers Ssangyong And BYD Join Hands To Develop EV Batteries And Electric Cars

Court conservatorship is a form of judicial protection available for companies that are nearing bankruptcy in Korea. The court takes company decisions and attempts to use multiple methods such as reorganising the workforce to revive the company. Ssangyong had lapsed on loan payments of around Rs 400 crore before filing for receivership. 

Get latest updates on
the automobile community

Login Now

A company can only stay under receivership for up to one year, but it has the option to get an extension of six months. Since Ssangyong’s year will be up in April 2022, the company is highly likely to apply for an extension until October. If it can’t find a buyer soon, Ssangyong could be liquidated. 

It remains to be seen if it’s the end of the road for Ssangyong. The SUV maker has plans for electrification and even revealed the X200 concept sketches and J100 electric SUV. Even so, Korean carmakers Hyundai and Kia are already several steps ahead with their ground-up EVs based on the E-GMP platform, such as the Hyundai Ioniq and Kia EV6. If it survives, Ssangyong has a tough road ahead with stiff competition in its home country. 

In India, the Mahindra Alturas G4 and XUV300 are Ssangyong-derived SUV models. 

Source