Mahindra One Step Closer To Ssangyong
I know that stories about who will buy a down and out Korean carmaker called Ssangyong are not a major click-through magnet. Therefore, just for the record: Ssangyong selected India’s Mahindra & Mahindra as the preferred bidder to acquire a majority stake. And just in case, they named India’s Raghav Industries as the secondary preferred bidder, says The Nikkei [sub].
Ssangyong wants to sign an M.O.U. with Mahindra by the end of August, but only after they fork over 5 percent of the (undisclosed) offered acquisition price as earnest money.
Mahindra wants to go through Ssangyong’s books first before they decide on a final price. A contract could be signed in November.
If the deal falls through, there is always the second preferred bidder. Raghav Industries is an investment affiliate of Indian conglomerate Ruia Group. Not in the car business per se, they dabble in tires, automotive-sealing products, heavy engineering, sugar and electronics.
Indian companies are quite aggressive when it comes to buying distressed automotive assets, something that still is a bit alien to the Chinese competition. But who knows, maybe Geely/Volvo will change that.
Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.
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Interesting. With the Korea/US free trade agreement Mahindra could get around US tariffs for trucks produced in Korea.
Let me see if I have this straight: - Mahindra (or was it Maruti?) announced they would come to the U.S., but didn't, - Mahindra repeated this announcement, and repeated the non-arrival in the U.S., - Ssangyong has sold cars in the U.S., but went bankrupt, - Mahindra wants Ssangyong... Could this be the step needed for Mahindra to make good on it's oft-announced, but never implemented, plans? Time will tell...
Could be I have it wrong, but I seem to recall seeing a couple of Rextons on the streets in Detroit a few years ago... perhaps they were there for testing, development, demonstration, or a competitor's benchmarking (but they did not carry the traditional "M" (Manufacturer) plate that is typically seen on such cars in Michigan...