Mahindra-Ssangyong deal approved

Ssangyong Motors, the troubled South Korean company taken over by Mahindra and Mahindra is in its final stage of acquisition. The final approval for sale has been given to the South Korean company.

The Fair Trade Commission has given its consent over the deal, that the South Korean car makers will be sold to the Mahindra and Mahindra.

Mahindra and Mahindra (India) will be the second in South Korea other than Tata Motors to take over an South Asian company. Tata Motors in 2004 brought Daewoo Commercial Vehicle, the truck manufacturing unit.

Mahindra is a very reputed name in India and is one of the leading commercial vehicle makers.

As per the Fair Trade commission, the new venture will raise the export of Ssangyong to a significant level and the deal will also be successful in generating competition in the market. Ssangyong, the South Korean car maker produces low cost vehicles but robust SUVs. The not so big car manufacturer also manufactures sedans.

Ssangyong, started in 1957 was in the manufacturing of automobiles. It was one of the severely hit company because of recession which resulted in the downfall of the car manufacturer. The South Korean company was given protection by court in 2009, February from its creditors after the oil prices shot up. The hike in petrol prices resulted in the downfall of the demand of the SUV globally. With the sales graph going down, the parent company Shanghai Automotive Industry Corp., refused to invest in Ssangyong. Ssangyong also faced hardships, when the work was disrupted for 80 or more days because of the sudden lay offs in the company due to world market crash.

Other than, Mahindra and Mahindra, there were few more giant groups from local and international market like Ruia Group from India, SM Aluminium, Seoul Investments and Reanult Samgsung from South Korea who were interested in purchasing the Ssangyong. But the Indian based Mahindra was zeroed for the biding in August this year.

If the sources to be believed, Mahindra Ssangyong will soon come with Korando C generation car. It is greatly rumored in the market that the new generation will witness cosmetic changes. Mahindra Mahindra will also launch the new car soon in India.

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