South Korean automaker SsangYong Motor Company said it had missed scheduled repayments to three creditors worth a combined KRW60bn (US$55m), according to local reports.
The subsidiary of Indian carmaker Mahindra & Mahindra has outstanding loans of KRW30bn with Bank of America Merrill Lynch, KRW20bn with JP Morgan and KRW10bn with BNP Paribas, which together account for 8% of its total equity.
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A further KRW90bn of debt is due to be repaid to Industrial Bank of Korea on 21 December.
In a recent regulatory filing Ssangyong said it “does not have enough funds to repay the debt due to worsening business conditions”, adding “we will try to extend the debt maturity with our creditors”.
The automaker has reported operating losses for 15 consecutive quarters with the COVID-19 pandemic making its operating environment even tougher.
The company’s global sales fell by 19% to 96,763 units in the first 11 months of 2020, due mainly to weak overseas sales.
Mahindra, which acquired a 70% stake in Ssangyong back in 2011 and now holds close to 75% of the equity, confirmed last August it was looking for a strategic partner for its loss making subsidiary as part of its own restructuring plan.
