Press Esc to close
Friday 29 May 2015
News updated at 1:30 AM IST
Weather
Max: 33°C
Min : 22.3°C
In Bengaluru
Sunny day

Mahindra in race for Ssangyong Motor takeover

Last updated: 28 May, 2010
Seoul/Tokyo, May 28, Reuters

Ruias & Renault too eye $500m deal

France’s Renault SA and India’s top utility vehicle maker Mahindra are in the running to buy troubled South Korean SUV maker Ssangyong Motor, sources said on Friday, in a deal worth up to $500 million.

Mahindra & Mahindra Managing Director Anand Mahindra

The participation of high profile international firms in the auction was seen as a potential threat to the dominance enjoyed by South Korea’s top automaker Hyundai Motor and its affiliate Kia Motors, not only on their home turf but in export markets.

Seven foreign and South Korean companies have submitted letters of intent for Ssangyong, 10 per cent owned by China’s SAIC Motor Corp, by the Friday deadline, Ssangyong said.

While the South Korea’s smallest carmaker declined to identify bidders, sources said the Renault and its Japanese partner Nissan Motor Co, along with India’s Mahindra & Mahindra have joined the fray.

An industry source in Japan with knowledge of the situation told Reuters any interest would come from Renault-Nissan, rather than its Renault Samsung Korean unit, but a review of Ssangyong may turn up nothing of interest to the Franco-Japanese alliance.
Ssangyong has been in court-led restructuring since early 2009, hammered by one of the industry’s worst downturns. A Seoul court kicked off the sale process for the cash-strapped SUV maker this month, and is set to receive binding bids by July 20 to pick a preferred buyer during August.

Nissan and Ssangyong declined to comment, while a Renault spokeswoman in Paris said: “For legal reasons, we can’t make any comment.”

Bidding plans

Asked about bidding plans, Mahindra President Pawan Goenka said: “We do not make any comments on future acquisition possibilities.” Samjong KPMG and Macquarie, which are handling the sale, declined to comment.

Mahindra has been looking for acquisitions to expand its portfolio and get access to new markets since it lost out to larger rival Tata Motors to buy Jaguar Land Rover in 2008, and analysts said the firm had more to gain from purchasing Ssangyong. Mahindra, which has revenues of about $6 billion, this week signed a deal to take a majority stake in pioneering electric car maker Reva.

South Korean media has put the deal value at $300 million-$500 million as a potential buyer is expected to subscribe to new shares amounting to Ssangyong’s current market value of $370 million to own at least 50 per cent of the company and also pay a management premium.

India’s Ruia Group, based in Kolkata has also submitted a letter of intent for Ssangyong. “We have been turning around sick companies in the past. Given our expertise in that, when this opportunity opened up in Korea, we decided to make a bid,” a spokesman told Reuters.


Go to Top

Photo Gallery
Devotees arrive at Sangam to take holy bath in Ganga River

Devotees arrive at Sangam to take holy bath in Ganga River

Students celebrate their success after the announcement of CBSE class 10th results...

Students celebrate their success after the announcement of CBSE class 10th results...

Monkeys drink water from a tap on a hot day...

Monkeys drink water from a tap on a hot day...

Bollywood actors Arjun Kapoor, Shahid Kapoor, Sonakshi Sinha, Anil Kapoor and Hrithik Roshan...

Bollywood actors Arjun Kapoor, Shahid Kapoor, Sonakshi Sinha, Anil Kapoor and Hrithik Roshan...

Adopted son Yadhuveer Krishnadatta Chamaraja Wadiyar sit on Silver Throne...

Adopted son Yadhuveer Krishnadatta Chamaraja Wadiyar sit on Silver Throne...

Adopted son Yadhuveer Krishnadatta Chamaraja Wadiyar and Pramoda Devi Wadiyar....

Adopted son Yadhuveer Krishnadatta Chamaraja Wadiyar and Pramoda Devi Wadiyar....

Adopted son Yadhuveer Krishnadatta Chamaraja Wadiyar sit on Silver Chariot...

Adopted son Yadhuveer Krishnadatta Chamaraja Wadiyar sit on Silver Chariot...

Adopted son Yadhuveer Krishnadatta Chamaraja Wadiyar perform a Yagna during....

Adopted son Yadhuveer Krishnadatta Chamaraja Wadiyar perform a Yagna during....

Relatives of Adopted son Yadhuveer Krishnadatta Chamaraja Wadiyar ...

Relatives of Adopted son Yadhuveer Krishnadatta Chamaraja Wadiyar ...

Yaduveer Krishnanadatta Chamaraja Wadiyar at a ritual in Mysore on Wednesday....

Yaduveer Krishnanadatta Chamaraja Wadiyar at a ritual in Mysore on Wednesday....

Copyright 2014, The Printers (Mysore) Private Ltd., 75, M.G Road, Post Box 5331, Bengaluru - 560001
Tel: +91 (80) 25880000 Fax No. +91 (80) 25880523