A South Korean court has said cash-strapped SsangYong Motor had the potential to be rescued, sending its shares up by the daily limit.
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Samil Pricewaterhouse Coopers had assessed Ssangyong’s value as a going concern at 389bn won (US$302.8m) greater than its liquidated value, the Seoul Central District Court said in a statement cited by Reuters.
The assessment was based on survival plans outlined by the company last month, including job cuts, and the assumption that Ssangyong would raise necessary cash of 250bn won, the court said.
News of the assessment, which will impact the court’s final ruling, pushed Ssangyong shares up 15% by the close, far outperforming a 0.32% fall in the wider market, Reuters said.
The court said it would hold a meeting with creditors and interested parties on 22 May to solicit their opinions, and to order Ssangyong to submit new survival plans. After that all parties will weigh whether to accept the plans and the court will make a decision, the report added.
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By GlobalDataIn February, the court accepted Ssangyong’s bankruptcy protection appeal, giving the carmaker, owned by China’s SAIC Motor, another chance after it posted four loss-making quarters on weak sales.
