Mahindra is the favourite in the contest for the acquisition of South Korean automotive manufacturer SsangYong. Fending off the advance of the Nissan-Renault-Samsung alliance, the Indian firm has announced its status as preferred bidder for SsangYong.
For any deal between the two companies to progress, both must sign an MOU (Memorandum of Understanding) to that effect and Mahindra will conduct due diligence leading up to the acquisition.
"Korea is one of the world's leading centres of automotive excellence and Ssangyong brings with it a rich legacy of R&D and innovation," said Anand Mahindra, Vice Chairman and Managing Director of the Mahindra Group. "Mahindra and Ssangyong will create synergy, which will make us significant global players."
Shared R&D resources are expected to benefit both companies, but SsangYong's gain is likely to be the greater, since the South Korean company's lifeline from Chinese automotive group SAIC was switched off two years ago. Since then, the Korean government has been funding SsangYong's continuing operations.
SsangYong first came to prominence in Australia for its Musso and Korando SUVs and the MB100/140 range of vans. All were sold locally through Benz dealers during the 1990s. Subsequently the company was acquired by Daewoo. For a time, the Musso and the Korando were sold through Daewoo dealers in Australia, before Holden brought down the curtain on the by-then GM-owned subsidiary.
Somehow, when Daewoo became GM-DAT, a GM subsidiary with no market presence outside South Korea, SsangYong remained independent and free of GM's clutches.
In Australia, the SsangYong marque is distributed by Peugeot importer Sime Darby and the Mahindra brand is handled by TMI Pacific.
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