The acquisition of SsangYong Motor by an Edison Motors consortium is teetering on the edge as the rest of the purchase price for the debt-ridden carmaker has not been paid by the deadline, The Korea Times reported citing sources.
The Seoul Bankruptcy Court ordered payment of the balance 274.3 billion won ($223.8 million) by March 25, five business days before a creditors' meeting on April 1 to decide on a rehabilitation plan for SsangYong Motor, which won’t be held due to non-payment.
SsangYong now has the authority to terminate the M&A contract. A source has told the publication. The consortium already paid about 10 percent of the total acquisition amount or 305 billion won ($254.65 million).
Moneycontrol could not independently verify the report.
The source added that Edison Motors had asked the court to extend the deadline.
Also Read | South Korea's SsangYong Motor Company to sell its Pyeongtaek plant as rehabilitation process
SsangYong had filed for court receivership in December 2020, as the company failed to repay around 160 billion won worth of loans and its Indian owner, Mahindra & Mahindra, put SsangYong up for sale. In November 2021, Edison Motors and SsangYong signed a memorandum of understanding for the purchase.
In January 2022, the consortium led by electric car company Edison Motors agreed to acquire SsangYong Motor.