A private equity fund has announced it is interested in buying a majority stake in Ssangyong, raising hopes the ailing car maker could be saved.
Seoul Invest, a Korean private equity firm, said it is in talks with domestic and foreign institutional investors to form a fund to buy a 51 per cent stake in Ssangyong.
“We have reviewed the possibility of Ssangyong’s revival for the past three months and have become convinced of its viability,” said Park Yoon-bae, the fund’s president.
“Many of the investors we are talking to are still pessimistic of Ssangyong’s future but we’re trying to persuade them.”
Ssangyong was placed under bankruptcy protection in February and has to submit a turnround plan to a Seoul court by mid-September.
The court will then decide whether to revive Ssangyong or liquidate it. Its recovery process was also severely disrupted when laid off workers occupied its factory, forcing its closure for 77 days.
If the court decides to approve Ssangyong's recovery plan then it is expected to seek a majority investor.
Park Yoon-bae said the fund would be able to turn round Ssangyong by improving labour-management relations and exporting price-competitive vehicles to emerging markets in Asia.