finally! A powerful Korean group acquires SsangYong

After several months of uncertainty, SsangYong Motor seems to see the light at the end of the tunnel, after announcing its sale to KG Group and following the agreement approved by the Seoul Bankruptcy Court; Thus, negotiations are expected to enter into force next October.

As a result of the deteriorating financial situation, SsangYong has been in custody since April of last year; At the beginning of 2022 Failed to be purchased by Edison Motorsa Korean company specializing in the production of electrified cars.

The seemingly final solution now comes from the hand of a Korean industrial giant: KG . groupwhich, in accordance with the stated agreement, He wants to acquire 61% of SsangYong Motor . sharesa proposal approved by 100% of the shareholders’ meeting and 95% of SsangYong’s creditors.

KG Group is a conglomerate of companies with a strong presence in the steel production and chemical industriesIt also has the financial backing of Cactus Private Equity. Both companies acquired steelmaker Dongbu Steel, which was on the verge of bankruptcy, in 2019 and in just three years the new company KG Steel achieved record sales and profits for the first time in a decade.

KG Dongbu Steel.

South Korea’s Fair Trade Commission gave the go-ahead for the process, while noting Be confident that your purchase will not affect competition in related markets, such as cold-rolled steel plates and vehicle manufacturing. He also added that the acquisition will only help SsangYong Motor Company to normalize its operations and enhance its competitiveness.

What analysts expect is that synergies will be very favorable for the company. Dongbu Steel has been a supplier to SsangYong even before it became KG Steel, while KG Chemical could focus on developing batteries for the brand’s electric futures. So far, the Korando E-Motion, SsangYong’s first 100% electric model, uses LG batteries.

SsangYong global sales remain low in 2022; In fact, There were 58,281 new units sold in the first seven months of the year, a decrease of 21%, Which is mainly explained by the export markets, where they grew at the local level by 6%.

In addition to the new Korando E-Motion, the brand has already been revealed New Torres SUVwhich will be launched globally later this year.