S. Korea's Ssangyong Motor opens stake sale bid

• Source: Xinhua
• [17:38 May 10 2010]
• Comments

South Korea's Ssangyong Motor Co. on Monday opened a bid for its stake sales for the sake of the company's viability, local media reported.

According to Yonhap News Agency, Ssangyong, a former affiliate of China's Shanghai Automotive Industry Corp. (SAIC), will complete receiving letters of intent from potentital bidders by May 28, among which the company will select a preffered bidder in August.

The stake sale is estimated to be around 300 to 500 billion won ($265 million to $441 million), according to the media forecast.

Ssangyong has been planning a controlling stake sale as it was in late 2009 approved of a turnaround plan to write off about 80 percent of shares owned by its former parent SAIC, reducing its stake from 51 percent to 11.2 percent.

Ssangyong, South Korea's smallest carmaker, entered bankruptcy protection in February after SAIC decided to withdraw from the company due to its losses.

The company went through a massive layoff as part of a restructuring plan order by a local court, shedding 2,646 workers, or 36 percent of its workforce.

While undergoing the layoff, Ssangyong's operations have been suspended as unionized workers protesting the job-cuts occupied the automaker's only plant in Pyeongtaek, located south of Seoul, for 77 days.

Hit by the strike, which supposedly cost the company 316 billion won ($272.4 million ) in lost production, Ssangyong's net loss expanded to 177.1 billion won ($152.7 million) during the second quarter of 2009.