In a recent development, officials from South Korea's Chohung Bank revealed to local newspapers that Changhong Bank and Ssangyong are set to sign a memorandum of understanding within the next month regarding the potential sale of the SUV manufacturer they control. Jae-Yoo Kim, vice president of Changhong Bank, also confirmed to Dow Jones Financial News that the bank is expected to soon announce its preferred buyer for Ssangyong.
Ssangyong’s creditors have expressed interest in selling the company to SAIC (Shanghai Automotive Industry Corporation), one of the most prominent Chinese automakers. Last month, SAIC submitted a bid for Ssangyong, joining other contenders such as China’s BlueStar Group and several investors from Hong Kong and the U.S. Notably, BlueStar had previously been considered a top candidate for acquisition in December last year but was later sidelined due to disagreements over pricing and lack of government support in China.
Following this, Ssangyong’s creditors began re-selling their 48.92% stake in the company. In December, SAIC received official approval from China’s National Development and Reform Commission as the sole Chinese buyer for Ssangyong Motor Company, marking a significant step forward in the negotiations.
Since its separation from the bankrupt Daewoo Group in 1999, Ssangyong has shown steady performance, but it continues to face a heavy debt burden if it is to remain independent for the long term. The company currently has an annual production capacity of 180,000 vehicles, which highlights both its operational scale and the challenges it faces in maintaining financial stability.
This ongoing auction process reflects the growing interest from international players in acquiring a key player in South Korea’s automotive sector. As the situation unfolds, the outcome will likely have far-reaching implications for Ssangyong’s future and the broader automotive industry.
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