SsangYong Urged to Make Desperate Efforts for Survival
SsangYong Motor is not eligible for support from the Basic Industry Stability Fund, state-run Korea Development Bank (KDB) said on June 17.
"Companies that had management problems before the beginning of the COVID-19 crisis are not eligible for support from the Basic Industry Stability Fund," said Choi Dae-hyun, vice president of the Corporate Finance Division at KDB, at an online news conference.
"To qualify for support from the fund, SsangYong Motor definitely needs to meet a few conditions," Choi said. "The company’s majority shareholder, management and workers must have a strong will to survive and make efforts to this end. The sustainability of the company should also be confirmed."
He also said KDB will not collect any funds that were previously provided to the ailing automaker, if other lenders agree. "We are talking about extending the maturity of that 90 billion won in loans due in June."
KDB chairman Lee Dong-gull called for desperate efforts by SsangYong Motor’s labor and management. "We are examining various reports and research papers on SsangYong`s sustainability," he said. "We hope that the current labor and management discuss their situation more seriously and honestly. I think they are just trying to survive without seriously thinking about how to ride out current difficulties."
India's Mahindra & Mahindra Group, the largest shareholder of SsangYong Motor, recently hinted that it could give up management control of the automaker.