KG Mobility, formerly SsangYong Motor, reportedly is acquiring electric bus maker Edison Motors as part of its business diversification strategy.
Yonhap News agency, citing a regulatory filing, said a bankruptcy court in Changwon had picked KG Mobility as a preferred bidder to acquire Edison which has been under a court led debt rescheduling programme since January.
Edison previously tried to acquire SsangYong Motor early last year but failed to make a full payment for the debt laden carmaker, which was under court receivership, by the 25 March.
The Seoul Bankruptcy Court next picked KG as final bidder to acquire SsangYong in June 2023 and approved its debt payment plans in August. In October, SsangYong emerged from the 1 1/2-year court receivership.
KG Mobility submitted a letter of intent to acquire Edison Motors last month, conducted preliminary due diligence early this month and submitted an investment proposal to the bankruptcy court in Changwon which is in charge of the debt restructuring.
The court plans to pick the final bidder for Edison Motors through a stalking horse bid, in which preliminary bidder KG Mobility suggests its price for Edison ahead of an auction and other bidders submit their prices in the auction.
If a bidder suggests a higher price, KG Mobility has to decide on whether to take over Edison at the other bidder’s price or not.
The court is expected to hold the auction next month.
Edison Motors is based in Gyeongsangnam province in the south of the country, was declared bankrupt in May of 2022 and, last October, its chairman, Kang Young-kwon, and two executives were charged with making illegal profits of KRW162bn (US$120m) from stock price manipulation during the company’s attempt to acquire Ssangyong.
Edison Motors makes a range of battery-powered city buses and light trucks which are sold mostly in South Korea.
