The head of US-based vehicle importer HAAH Automotive Holdings has said the company is set to submit its letter of intent (LoI) next week to acquire the debt-ridden SsangYong Motor Co, industry sources said on Sunday.

SsangYong’s Indian parent Mahindra & Mahindra Ltd had been in talks with HAAH to sell its majority stake in the Korean unit since last year as part of its global reorganisation plan amid the Covid-19 pandemic.

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In 2011, Mahindra acquired a 70 per cent stake in SsangYong for 523 billion won and now holds a 74.65 per cent stake in the SUV-focused carmaker.

HAAH Automotive Holdings founder Duke Hale said HAAH is the optimal company to acquire financially troubled SsangYong and will submit an LOI by Friday, a person familiar with the matter said over the phone.

HAAH was expected to submit its LOI to the Seoul Bankruptcy Court by March, but it did not send the documents, raising doubts about its intention to invest in SsangYong, reports Yonhap news agency.

In April, SsangYong was placed under court receivership for the second time after undergoing the same process a decade earlier.

Court receivership is one step short of bankruptcy in South Korea’s legal system. In receivership, the court will decide whether and how to revive the company.

As for the failure to submit an LOI, the HAAH chief said the company needed more time to look into SsangYong’s financial details before making an investment decision.

If HAAH succeeds in acquiring SsangYong, he said the California-based car importer plans to bring SsangYong’s SUV models and pick-up trucks to the US and Canada.

SsangYong plans to receive LOIs from interested investors until Friday in the auction to find its new owner.

China-based SAIC Motor acquired a 51 per cent stake in SsangYong in 2004 but relinquished its control of the carmaker in 2009 in the wake of the 2008-09 global financial crisis.

KPMG Samjong Accounting Corp, the auditor of SsangYong, declined to give its opinion on the carmaker’s annual financial statements for the year 2020.

SsangYong could be delisted if its accounting firm again refuses to offer an opinion on the company’s annual performance for the following year after the one-year period.