Ssangyong Motor wins approval for court receivership

(ATTN: UPDATES throughout with details)
SEOUL, Feb. 6 (Yonhap) -- Ssangyong Motor Co. won permission Friday for its
application to reschedule debts with its creditors under court receivership,
clearing the first hurdle for the troubled automaker to normalize its operations.

The decision by the district court in Seoul had been widely expected because the
bankruptcy of Ssangyong -- owned by China's Shanghai Automotive Industry
Corp.(SAIC) -- would deal a critical blow to South Korea's automaking industry.
The district court in Seoul named Park Young-tae, Ssangyong's executive vice
president, and Lee Yoo-il, a former chief executive with Hyundai Motor Co., as
co-managers to determine the company's future under court receivership.
Under the court receivership, parent company SAIC will lose management control
and Ssangyong will then have about one year to map out a restructuring plan.
Ssangyong's efforts to stay afloat, however, still face a number of challenges
that may prove to be insurmountable, analysts say.
The company is struggling to come up with a restructuring plan that would call
for radical jobcuts. If creditors aren't satisfied with the restructuring plan,
they could liquidate the company.
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