South Korea's SsangYong Motor Company to sell its Pyeongtaek plant as rehabilitation process

SsangYong Motor Company (PC-Shutterstock)

South Korea-based automobile manufacturer SsangYong Motor Company has decided to sell its Pyeongtaek plant as part of self-rescue efforts, The Korea Times quoted local government as saying on Saturday.

The debt-ridden automaker's Indian parent Mahindra & Mahindra failed to secure a buyer for its 75 percent stake in the automaker, the daily noted. Following this, SsangYong Motor Company has been under court receivership since April.

ALSO READ: SsangYong looks for a new investor, plans to complete sale process by October: Report

According to the new development, the city government of Pyeongtaek has signeda memorandum of understanding with the court-appointed manager of SsangYong and its labor union regarding the sale of the site. The plant -- constructed in 1979 -- is spread across 850,000 square meters and is valued at 900 billion won ($786 million).

However, the city government of Pyeongtaek has assured the firm that it will provide administrative support in the process of construction and relocation, as the firm will build a new factory in Pyeongtaek.

"We will actively support SsangYong Motor to grow into a global company that contributes to the development of the local economy," The Korea Times quoted Pyeongtaek Mayor Jung Jang-seon as saying.

Adding more, court-appointed administrator Chung Yong-won said SsangYong Motor's ne plant will focus on green and self-driving cars as a base for the company's long-term survival.

Earlier on June 28, the automaker opened an auction for its majority stake. In charge of the sale process, EY Han Young had even issued a public notice, stating, that it will accept letters of intent from potential buyers until the end of July. The preliminary reviews on LoIs will be conducted in August.