SAIC, owner of bankrupt Ssangyong, says it will retain its interests in Ssangyong’s assets, even though it has lost control of the company.
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SAIC has said that it hopes a ‘practical business revival plan’ will be arrived at to put Ssangyong back on track as soon as possible.
SAIC’s ownership of Ssangyong has been controversial in Korea and it has faced accusations that it has stolen the Korean company’s technology and failed to invest sufficiently.
“I don’t think Ssangyong’s case will pose a big threat to SAIC’s financial performance and operation,” said Zhu Siming, an automobile analyst at consulting firm Frost & Sullivan.
Besides, SAIC may well take advantage of other brands it had purchased, such as Roewe, to develop and boost its SUV sector, he added.
Last week Ssangyong was given the green light by Korean authorities to go into receivership to protect it from its creditors.
The South Korean automaker, which is 51.3% owned by SAIC Motor, was however warned that going into administration did not guarantee its future.
“A revival requires the company’s own efforts, including strong restructuring, and the concession of creditors. If its own effort is not enough, the revival process will be abolished,” the court said in a statement.
Under the deal, the Chinese firm will lose management control of Ssangyong but will maintain rights to some other assets.
The court appointed Lee, Yoo-il, former president of Hyundai Motor, and Park, Young-tae, Ssangyong’s director of finance planning, to manage the company.
