SEOUL-- Edison Motors Co. has appealed a court decision nullifying a restructuring plan for SsangYong Motor Co. following the collapse of the deal to acquire the debt-ridden carmaker due to its payment failure, a filing showed Tuesday.
Edison EV, an affiliate of Edison Motors, made the disclosure about the filing of the special appeal with the Supreme Court, seeking the court decision to be quashed and the case to be sent back to the Seoul Bankruptcy Court, according to the regulatory document filed Monday.
Last week, the Seoul Bankruptcy Court nullified the corporate rehabilitation plan for SsangYong, the South Korean unit of Indian carmaker Mahindra & Mahindra Ltd., after Edison Motors failed to meet the March 25 deadline to pay the remaining 274.3 billion won (US$226.2 million).
"We believe SsangYong Motor will not be able to sign a takeover contract with a new buyer until the Supreme Court rules on the special appeal," an official from the Edison Motor consortium said.
"Considering that a top court decision takes at least 2-3 months, it will be difficult to proceed with the takeover within the deadline for the end of restructuring, with the Edison Motor consortium being excluded," the official said.
The court has set a new deadline for SsangYong to find a new owner and submit a new restructuring plan by May 1, as SsangYong called off the 304.8 billion-won takeover deal with Edison.
If submitted in time, the court will decide whether to approve the new restructuring plan by mid-October. The court-led rehabilitation process for SsangYong began on April 15, 2021.
The official stressed the Edison consortium will continue to pursue the acquisition of SsangYong by pulling in more investors.
Following the deal's collapse, Ssangbangwool Inc., a South Korean underwear maker, made public its intent to buy SsangYong by forming a consortium of its own.
Edison has filed for a court injunction seeking to retain its position as the preferred bidder for the SUV-focused carmaker and asking the court to place the initial 10 percent down payment under provisional attachment.
A consortium led by Edison signed the takeover deal with SsangYong in January, but Edison has had trouble raising funds for the takeover due largely to the loss-making Edison EV.
SsangYong's creditors and labor union also oppose the acquisition as they objected to the low debt payment ratio in the rehabilitation plan.
Source: Yonhap News Agency