Mahindra to retain Korean senior management at Sangyong

Mahindra & Mahindra is in its final stage of purchasing Sangyong, the Korean auto company by shelling out $465 million, while few biggest creditors have agreed to a haircut. “Haircut” is the perceived risk against the face value of the assets used simultaneously.

As per a source from M&M close to the deal, the final process is expected to be over by February first week and couple of months to follow will include the formalities to acquire the auto company. M&M that owns the 70 per cent of the publicly listed firm has decided that it will retain the top level executives from Sangyong. It is being learnt that the Indian utility maker have decided not to delist the company in Korea. As per the reports, Mahindra plans that Sangyong will work as a separate enterprise while co-ordination and help from the parent company for fund raising and product development will be provided.

Pawan Goenka, President of the automobile and farm equipment division in M&M said that it looks like the process will complete by next month probably in the first or the second week but after that two months will be required to complete the formalities. However, the creditors have accepted the haircut but it is only a part of the taking over process and not the final verdict. He also ushered that there are various creditors that still need to nod on the deal.

Mahindra is following the footprints of its contemporary Tata Motors as in 2008 the company took over the British luxury car brand Jaguar and Land Rover. Mahindra is all set to make it large by establishing its name in the global auto market. Currently it is developing electric cars with Reva, the new partner, to venture in the electric car market.

Read More on : Mahindra Scorpio 2013