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Debt-ridden automaker SsangYong Motor has decided to sell its Pyeongtaek plant site as part of self-rescue efforts, the local government said on Saturday.
The company has been in receivership since April after its Indian parent company Mahindra & Mahindra has failed to find a buyer for its 75% stake in the automaker.
The government in Pyeongtaek city, 70 km south of Seoul, said it had signed a memorandum of understanding with the court-appointed director of SsangYong and his union regarding the sale of the site, which measures 850,000 square meters. and is valued at 900 billion won ($ 786 million).
The factory was built in 1979.
The company will build a new factory in Pyeongtaek, and the city will provide administrative support in the construction and relocation process, the city said.
“We will actively support SsangYong Motor to become a global enterprise that contributes to the development of the local economy,†said Jung Jang-seon, mayor of Pyeongtaek.
Chung Yong-won, a court-appointed administrator from SsangYong, said the new factory will focus on green and self-driving cars as the basis for the company’s long-term survival, Yonhap News Agency reports.
SsangYong opened an auction for its controlling stake on June 28.
Half of SsangYong Motor Company’s employees will take two-year unpaid leave starting next month as part of self-help measures as the debt-ridden automaker struggles to speed up its sales process, the company announced last month.
The automaker has been in receivership since April because its parent company, Mahindra & Mahindra (M&M) failed to attract an investor amid the protracted pandemic and worsening financial situation.
–IANS
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(Only the title and image of this report may have been reworked by Business Standard staff; the rest of the content is automatically generated from a syndicated feed.)
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