Ssangyong Might Be Hit By Strike, Fears Liquidation
According to Reuters, Ssangyong union workers have authorized a strike in case this proves to be necessary. They consider SAIC had not provided enough financial resources for the South Korean automaker.
"Our members approved a strike, but we will be very careful on launching an action as many of our suppliers are facing risks of bankruptcy," union spokesman Lee Chang-kun said. But the strike is not the worst thing that could happen to Ssangyong this month...
Their intention was triggered by a statement of a South Korean court claiming it had frozen debts, obligations and assets of Ssangyong and is likely to come up with a decision in a month whether to accept the company's demand for bankruptcy protection. If it accepts the filing, new management will be appointed by the court and SAIC would keep its stake but would have to give the court control of the c. Otherwise, Ssangyong faces the possibility of being liquidated.
For those who don't know by now, SAIC is main shareholder at Ssangyong with a 51 percent stake. It paid $45 million to Ssangyong at the end of December last year, but that was not the first time when SAIC invested money in the South Korean firm. They've also paid $500 million for a 49 percent of Ssangyong in 2004.
Moreover, South Korea's financial regulator went on urging SAIC to make efforts to revive Ssangyong.
In a desperate effort to save Ssangyong and its suppliers as well from bankruptcy, the union workers asked for the help of the government."The government needs to put out an imminent fire at our suppliers. If they close their business, Ssangyong cannot revive even after the court approves bankruptcy protection," Lee said.
Every time something fishy is going on, people refrain from commenting. So did a spokeswoman at SAIC, China's biggest car maker, as well as a Ssangyong spokesman.
Most surely, the future of Ssangyong and its workers lies in SAIC's hands because if they don't find any ace up their sleeve, the South Korean will soon be history...