|Title||SsangYong Motor files for rehabilitation procedures|
-Board meeting held on December 21 agrees to apply Autonomous Restructuring Support (ARS)
-Plans to withdraw early before the rehabilitation procedure to be agreed with stakeholders
-Another step in the transformation and rebirth of SsangYong into a competitive company
Following a Board meeting yesterday, 21 December, SsangYong Motor Company has decided to apply for rehabilitation procedures. These include applying for a Company Property Preservative Measure,a General ProhibitionOrderand Autonomous Restructuring Support (ARS), with a decision to whether to commence the rehabilitation procedures to be agreed with stakeholders.
SsangYong has delayed repayment of some 60 billion won in loans and interest due to worsening business conditions. The company has been seeking to extend the maturity date with its lenders, but has been unable to reach an agreement, and decided to apply for these rehabilitation procedures to avoid interrupting its business operations.
However, the company plans to resolve the current liquidity issue early before the rehabilitation procedures are commenced by applying for Autonomous Restructuring Support.
Autonomous Restructuring Support is a private restructuring support program made with the court which delays the initiation of the rehabilitation procedures by up to three months while the company continues its attempts at private restructuring. During this period, the company continues its normal business activities. When the company and its interested parties reach the final agreement for the restructuring, the rehabilitation procedure application is withdrawn, and it returns to its normal company status without harm to its reputation.
SsangYong Motor has agreed to adjust the concerns of interested parties while the rehabilitation procedures have been suspended. During this time, the repayment burden of the principal loan and interest is lifted, and the company plans to complete the negotiations and apply to the court as soon as possible to withdraw the rehabilitation procedures.
“During the period of Autonomous Restructuring Support, Mahindra would take responsibility as a major shareholder, and actively cooperate with SsangYong for the normalization of management through to the early conclusion of negotiations with interested parties” said the official spokesperson of Mahindra.
SsangYong Motor commented, "We very much regret this situation which is the result of the difficulties being experienced from the worldwide COVID-19 situation, and the concern caused to our partners and stakeholders, especially our employees, sales networks and financial institutions. We are making every effort to transform the situation, and to build a more robust and competitive company for the future." <Ends>