Thaindian News

Seoul, Aug 12 (DPA) Indian utility vehicle maker Mahindra & Mahindra Ltd has emerged Thursday as preferred bidder for a majority stake in ailing South Korean carmaker Ssangyong Motor Co.
The smallest of South Korea’s five carmakers and its creditors said that they had chosen the Indian company and planned to sign a memorandum of understanding by the end of the month.

Ssangyong said it hoped to finalise the sale by November, but did not release details about the Indian company’s offer.

The final sale price is to be determined in October after Mahindra has a chance to check Ssanyong’s books, South Korean media reported amid speculation that the price for the majority stake could be between 400 and 500 billion won ($324 and $419 million).

Mahindra was given the nod after checking the offers, financing tools and management plans for the time following the takeover, Ssangyong’s statement said.

Six bidders including the French company Renault SA and its Japanese partner Nissan Motor Co submitted offers, the Yonhap news agency reported, but the list was later narrowed down to three contenders, including Indian tyremaker Ruia Group and South Korean headgear maker Young An Hat Co.

In December a court agreed to a rescue plan for the cash-strapped carmaker, enabling Ssangyong to continue operations and find new investors.

Ssangyong, which had been owned by China’s Shangahi Automotive Industry Corp, was put under court protection in February 2009, after sales crashed in the wake of the global financial crisis.

In the first three months of 2010, sales tripled to 43,881 units.