Mahindra to go global with Ssangyong takeover

India based largest utility vehicle maker Mahindra & Mahindra has stated on Friday that the prospective acquisition of South Korean automaker Ssangyong Motor would help the company in emerging as a global power in the SUV segment. Mr Anand Mahindra, vice-chairman and managing director at M&M said in a statement given to media persons that Korea is one of the world’s leading centres of automotive excellence and Ssangyong brings with it, a rich legacy of R&D and innovation. He added that the synergies between both the brands, which share a similar heritage, will make M&M a combined force to reckon with in the global SUV space.

According to M&M, both of the companies will sign an MoU, that will be followed by the process of due diligence and finalisation of definite agreements. However, the company is yet to disclose the sum that it has agreed to pay to get the preferred bidder's status in Ssangyong bidding. As per the industry sources, the Ssangyong takeover could cost the company as much as $500 mn. The bankrupted Korean firm has a debt of $640 mn. According to Mr Pawan Goenka, president of automotive and farm sector at M&M, the company will leverage Ssangyong’s competencies in R&D and technology. He added that Mahindra's focus on alternative fuels and electric vehicles will further strengthen Ssangyong’s brand value and will take it to new geographies.

The Ssangyong Motors is the smallest car maker of South Korea and it known for making the lowest priced yet robust SUV's in the Korean market. The company's portfolio carries popular brands like Rexton, Kyron and Actyon. The 10% stake of the company has been held by China’s SAIC Motor, while about 70% is held by the creditors of the company.

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