이 기사는 2021년 03월 24일 07:57 thebell 에 표출된 기사입니다.

South Korea’s debt-ridden SsangYong Motor is likely to go through rehabilitation proceedings, with slim chances of HAAH Automotive Holdings buying the automaker.

In December last year, SsangYong applied for the bankruptcy court's autonomous restructuring support program and was given until February 28 to find a solution with creditors. The deadline was extended to March 2, which also expired.

The automaker initially sought to submit a reorganization plan to the court to file for a prepackaged bankruptcy that will reduce its debt burden. This required the nod of creditors holding more than half of the company’s debt, but SsangYong has been struggling to get consent from creditors.

Concerns over the possible collapse of talks with HAAH have also complicated the situation.

“HAAH has not even submitted a letter of intent yet, raising a question whether it really wants to buy SsangYong or not,” an industry insider said. “There has been no progress with respect to SsangYong’s prepackaged plan either.”

The court could order SsangYong to go through rehabilitation proceedings if negotiations between HAAH and SsangYong continue to make slow progress in the coming weeks, industry watchers.

Korea Development Bank, the main creditor of SsangYong, is maintaining the position that it would not provide further financial support until the automaker comes up with a concrete rehabilitation plan.

If SsangYong ends up going through proceedings that will be supervised by the court, it could ultimately be liquidated since its value as a going concern is lower than its liquidation value. (Reporting by Seon-young Kim)