SsangYong Motor Company (SMC) is a South Korea based Sports Utility Vehicle (SUV) manufacturer which is currently under financial pressures. A Korean news paper by the name Korean Economic Daily recently reported that Mumbai based Mahindra & Mahindra had issued a letter to SMC revealing its intensions to buy stakes of the beleaguered company. However, the newspaper did not reveal the source of the news. M&M also decided to keep silence.
49 percent of stakes was bought by China’s auto marquee Shanghai Automotive Industry Corp (SAIC) after the payment of $500 million earlier in 2004. SAIC which is a part of General Motors’ Indian operations, is the present promoter of SMC. The company which manufactures 4X4 SUVs and recreational vehicles also observed the investment of Mercedes-Benz AG earlier.
What adds proof to M&M’s interest in SMC is its earlier interest in 2003 when Daewoo, the then holding company of SMC went bankrupt. However, M&M withdrew its plans after believing that SMC wouldn’t be suitable for its international operations. The firm also had plans of introducing SMC’s 7 seater SUV Rexton to the Indian market along with its Scorpio as a flagship model. However, the firm withdrew these plans as well.
Recently, a SMC spokesperson also indicated that the firm would soon announce a stakes sale which drew the interest of many other international manufacturers.