The large creditors of troubled South Korean firm Ssangyong, including Barclays Bank and Korean Development Bank, have approved the acquisition of this sports utility vehicle (SUV) maker by Mahindra & Mahindra. With this green signal from major creditors, the acquisition process has entered into its final stage and is expected to be completed by next month. Going ahead with the acquisition process, M&M will now acquire a 70 percent stake in Ssangyong for $463 million.
After receiving the approval from major creditors, the company will now seek formal consent from both secured and unsecured creditors along with about 500 suppliers of Ssangyong Motors in a meeting to be held on January 28 in Seoul. This will be followed by seeking of the mandatory approval from a district court in the South Korean capital.
“We are meeting towards the end of January for the final approval from the creditors and the formalities of the acquisition should be completed soon,” said Mr. Pawan Goenka, president, auto and farm equipment division, M&M.
Following the acquisition, Ssangyong will continue working as a separate entity of M&M under the same management. The Indian auto giant is planning to send seven of its senior executives to work closely with the Korean management.
