Cash-strapped SsangYong Motor seeks to avert stock market delisting

SEOUL-- Financially troubled SsangYong Motor Co. said Tuesday it has raised an objection to the Seoul bourse operator's decision to delist it from the local stock market.

Trading of SsangYong stocks on the main bourse KOSPI has been suspended after it filed for court receivership in December due to impaired capital base. Its external auditor also rejected its annual financial report last month.

The Korea Exchange (KRX) said in a regulatory briefing that it will review SsangYong's objection and may allow the automaker to improve its financial situation.

The SUV-focused automaker logged 449.4 billion won (US$398 million) in operating losses last year, increasing its deficit from 281.9 billion won in 2019. Its sales dipped 18.6 percent on-year to 2.9 trillion won in 2020.

SsangYong has recently reassessed its assets, including its Pyeongtaek headquarters and other land lots, which boosted its book value by 279 billion won to a total of 681.3 billion won in capital as of 2020.

Indian carmaker Mahindra & Mahindra Ltd., SsangYong's parent company, has been trying to sell its controlling stake in the Korean unit but has faced difficulty in narrowing terms of the deal with a potential buyer.

Mahindra acquired a 70 percent stake in SsangYong for 523 billion won in 2011 and now holds a 74.65 percent stake in the carmaker.

Court-led restructuring program is widely expected to begin this week as U.S. vehicle importer HAAH Automotive Holdings Inc., which showed interest in the deal, did not submit a letter of intent by the March 31 deadline.

Court receivership is one step short of bankruptcy in South Korea's legal system. In receivership, the court will decide whether and how to revive the company.

Source: Yonhap News Agency

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