Mahindra Signs Deal for Ssangyong

Mahindra & Mahindra, the Indian manufacturer who had the best chances of getting its hands of the South Korean SUV maker Ssangyong, followed through with its status and announced the signing of a Memorandum of Understanding (MoU) with Ssangyong.

The financial terms of the deal have not been announced yet, but reports are that given Mahindra's reserves, the acquisition of the South Korean brand will be done using the company's money. Estimates are that the deal would cost Mahindra in between $400 million and $500 million. The deal is expected to close in November.

The main goal Mahindra is pursuing with this deal is to strengthen its position in the SUV sector of the industry. The new acquisition will give Mahindra access to this segment on the markets in Europe, Russia, South America and the US.

“We are committed to leveraging Ssangyong’s strong competencies in R&D and technology by investing in a new SYMC product portfolio, which will help us gain momentum in global markets. Mahindra’s focus on alternative fuels and electric vehicles with the acquisition of REVA, will further strengthen SYMC’s brand value and take it to new geographies,” Pawan Goenka, president automotive and farm sector at Mahindra said in a statement cited by Business Standard.

“M&M is committed to nurturing the SYMC brand in global markets, while preserving its Korean heritage. It is intended that SYMC will continue to function as an independent entity with Korean management. The acquisition will offer financial stability to SYMC, while making M&M the largest Indian employer in Korea,” a company statement reads.