Mahindra and Ssangyong to sign agreement today
Mahindra & Mahindra and Ssangyong- South Korean auto motive maker- are expected to finalize the latter's acquisition on Tuesday. The Indian auto giant may take over the in loss Ssangyong Motors by paying almost Rs 2,000 crore. It is expected the deal will be closed by 2011 March The company executives disclosed that, Pawan Goenka, the automotive head and VS Parthasarathy, the chief investment officer went to Seoul to stamp the deal for the share purchase agreement draft made by Bae Kim & Lee, the South Korea's largest legal firm.
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Mahindra & Mahindra and Ssangyong- South Korean auto motive maker- are expected to finalize the latter's acquisition on Tuesday. The Indian auto giant may take over the in loss Ssangyong Motors by paying almost Rs 2,000 crore. It is expected the deal will be closed by 2011 March
The company executives disclosed that, Pawan Goenka, the automotive head and VS Parthasarathy, the chief investment officer went to Seoul to stamp the deal for the share purchase agreement draft made by Bae Kim & Lee, the South Korea's largest legal firm.
Ssangyong, the SUV makers, choose Mahindra & Mahindra India, as the bidder for the company this year in August as the Indian utility maker offered the highest bid for the bankrupt company. It is speculated that the bid will be funded with various internal accruals and debt.
As per auto industry experts, the step taken by M&M, is just like its rival company Tata Motors who took over the British Luxury brand Jaguar and Land Rover. It is expected that the deal between the Korean and Indian SUV makers will help the domestic auto market to establish in the global auto markets.
Ssangyong suffered the losses because of the unfortunate recession which hit the global auto market. The company laid off as many as 3,800 employees after the bankruptcy. The company is under almost $634 million debt and under court led restriction. The South Korean auto marker sells its sports utility vehicle in Europe, China, Russia and the Middle East.
Mahindra will support Ssangyong Motors with the financial resources, marketing strategies and other resources required however, Ssangyong Motors has already proven its prowess in the technological aspect. Ssangyong will provide the technological support to the Indian utility marker which is not competent enough in the same. Mahindra & Mahindra, the Indian locomotive maker is also looking for employers internally who will work with the Korean auto maker.
Mahindra in India is a well known brand in the SUVs and locomotive sector. The hot wheels of the M&M are Mahindra Bolero, Mahindra Scorpio, Mahindra Scorpio W and Mahindra Xylo. Mahindra has also launched Mahindra Logan and Mahindra Logan Edge under its venture with Renault. The company had already acquired Reva, the electric car company long time back.
