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Edison Motors buys SsangYong for 224 million euros to pay off its debts

After two years of uncertainty since the announcement of its bankruptcy, the South Korean justice has managed to find a positive solution to the future of SsangYong. According to the Yonhap agency, electric vehicle builder Edison Motors has the go-ahead from receivers to acquire the brand for a total of 224 million euros.

This amount – of which Edison declares to have already paid 10% – will go entirely to pay part of the debt incurred by SsangYong with various financial institutions.

However, this agreement represents only a first step. Before the receivership releases control of SsangYong, Edison Motors must present a rehabilitation plan which will be submitted to the judgment of the courts and the current creditors of the brand. To do this, you have until March 1.

For the time being, Edison has stated that his intention is to make SsangYong a manufacturer focused exclusively on electric cars. Looking to 2030, plans to make up to 30 different models.

In terms of financing, Edison has signed with SsangYong a separate loan for € 36.7 million, in order to compensate for its losses from the last year due to the pandemic and the decrease in sales. Later, the creation of a special purpose company is planned to raise 588.7 million euros. Said capital would return to the brand as an acquisition of shares, with the aim of achieving a change of course within three to five years.

Towards the end of instability

SsangYong prototype

Whenever Edison Motors obtains the approval of justice, it will be able to get down to work to grant SsangYong a stable future. Something that the Indian group Mahindra – its owner from 2010 until now – did not achieve.

The situation reached its breaking point at end of 2020, when the non-payment of a loan amounting to 47.9 million euros forced the brand to declare itself in bankruptcy. Failed negotiations with the South Korean government for its viability, justice took control of the company.

Despite this delicate financial situation, SsangYong’s business operations have not been affected at all. In countries like the UK – one of its key markets in Europe – it has recently expanded its dealer network. In terms of models, throughout 2021 it successfully launched the Tivoli Grand or the update of its flagship Rexton.

Its new owner Edison Motors specializes in the construction of heavy vehicles – trucks and coaches – with electric motors. Now, with the acquisition of Ssangyong they could obtain the ‘know how’ necessary to get closer to his great goal: to surpass Tesla herself.

In Motorpasión | We tested the SsangYong Rexton D22 DTR: a 181 hp, seven-seater 4×4 that takes a giant leap

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Lenny Li

I started to play with tech since middle school. Smart phones, laptops and gadgets are all about my life. Besides, I am also a big fan of Star War. May the force be with you!

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