이 기사는 2021년 12월 10일 08:04 thebell 에 표출된 기사입니다.

Market insiders are paying attention to whether a consortium led by Edison Motors, a prospective buyer of debt-ridden SsangYong Motor, will make a deposit by the end of this month to strike a final agreement with the South Korean carmaker.

SsangYong Motor and the Edison Motors consortium are in the final stage of negotiations to sign a deal, according to industry sources on Wednesday. The consortium has conducted detailed due diligence for about a month through Samjong KPMG.

The consortium paid about 5% of the acquisition price as the deposit on November 2 when it signed a memorandum of understanding with SsangYong Motor. The remaining 5%, or 15 billion won ($12 million), has to be paid when it signs the final agreement later this month. A buyer has to put down a 10% deposit before signing a final agreement to acquire a company under court receivership.

Some market insiders are also weighing the possibility that the consortium may not complete the payment. Under the current law, a deposit made by a buyer before signing a final agreement is non-refundable upon the termination of the contract.

“If the consortium fails to finance the acquisition cost and provide proof of funds, it will have to cancel the contract and lose a 31 billion won deposit,” said an industry source.

It is said that the Edison Motors consortium has proposed some conditions to the bankruptcy court to get its 31 billion won deposit refunded, which the court did not accept.

Industry insiders said the payment of deposit is one of the reasons behind the consortium’s extended detailed due diligence. The consortium needs additional 1 trillion won, excluding the 31 billion won deposit, for debts that it is obliged to pay immediately and working capitals.

The consortium is also considering a possible price adjustment as the acquisition price is lower than the amount of priority debts.

It plans to finance 700 billion won worth of priority debts through a capital increase and secured loan. Some market insiders said the consortium’s funding plan is insufficient to prove its ability to repay the priority claims - including 400 billion won unpaid wages – that must be paid in full.

The deal will fall apart if the consortium decides not to make the remaining deposit before signing the final agreement. (Reporting by Seon-young Kim)