Ssangyong Motor’s factory in Pyeongtaek, Gyeonggi Province, on June 8. (Yonhap)
SsangYong Motor, a debt-ridden automaker, decided to sell the site of its plant in Pyeongtaek as part of self-rescue efforts, the local government said Saturday.
The company has been under court receivership since April, as its Indian parent, Mahindra & Mahindra, failed to secure a buyer for its 75 percent stake in the automaker.
The city government of Pyeongtaek, 70 kilometers south of Seoul, said it has signed a memorandum of understanding with the court-appointed manager of SsangYong and its labor union, regarding the sale of the site, which measures 850,000 square meters and is valued at 900 billion won (US$786 million). The plant was constructed in 1979.
The company will build a new factory in Pyeongtaek, and the city will provide administrative support in the process of construction and relocation, the city said.
"We will actively support SsangYong Motor to grow into a global company that contributes to the development of the local economy,"
Jung Jang-seon, mayor of Pyeongtaek, said.
Chung Yong-won, court-appointed administrator, said the new plant will focus on green and self-driving cars as a base for the company's long-term survival.
SsangYong opened an auction for its majority stake on June 28.
EY Han Young, an accounting firm in charge of the sale process, issued a public notice that it will accept letters of intent from potential buyers until the end of July and conduct preliminary reviews on them in August. (Yonhap)