M&M to sign term sheet next week for SsangYong stake sale

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SME Times News Bureau | 02 Jan, 2021
Mahindra & Mahindra (M&M) is hopeful of finding a buyer for the majority stake in its South Korean subsidiary SsangYong Motor Company (SYMC) soon, and is aiming to sign the term sheet next weeks.

Talking reporters on Friday, M&M MD Pawan Goenka said that the company is actively scouting for an investor to take majority stake in SsangYong to keep it going.

The new investor would have the majority stake and M&M will have 30 per cent or less if the deal goes through.

He furuther said that if the deal does not go through, SsangYong will go intro court receivership.

Goenka noted that there are two more months to conclude a deal with an investor for SsangYong.

Last month, SsangYong has filed for rehabilitation procedure with the Seoul Bankruptcy Court.

Goenka also said that Mahindra plan to build a strong SUV portfolio based on electric vehicles.

"We have newest and modern portfolio of gasoline engines and we are confident that we have an advantage as it came in last two-three years," he said.

On the latest announcement of cancelling the proposed joint venture with Ford, the company said that the joint venture did not make much sense because of the kind of investments that were needed for it.

Earlier in the day, in a regulatory filing, the company said that that M&M and Ford Motor Company have "mutually, amicably determined" they will not complete a previously announced automotive joint venture between their companies.

The action follows the passing of the expiration date of a definitive agreement the organisations entered into in October 2019.

Rajesh Jejurikar, Executive Director, Auto and Farm Division, M&M noted that SUV segment is in high focus, and the company plans to launch two cars on all new platforms this year.