M&M says likely to conclude deal to sell stake in Ssangyong by Feb end

Company says may sign term sheet next week, deal is more or less agreed; Post sale, Mahindra will hold less than 30% in the firm

Mahindra and Mahindra said is in the final stages of getting a buyer on board for its ailing Korean subsidiary Ssangyong Motor Co (SYMC) and is likely to conclude the deal by February end, company’s top officials told reporters on Friday. “We may sign a term sheet for SYMC next week. The deal is more or less agreed. We will conclude it by February 28, if everything goes as per the plan,” Pawan Goenka, managing director and CEO said. Post the sale, Mahindra will hold less than 30 per cent equity in the maker of Rexton and Tivoli SUVs, said Goenka.

On December 22, company’s Korean subsidiary said it has commenced a rehabilitation procedure with the Seoul Bankruptcy Court. This was after the struggling automaker missed the December 14 deadline for repayment of Rs 480 crore (60 billion Korean Won) to JPMorgan Chase Bank in South Korea.

Mahindra said that the size of impairment taken by it would be based on the nature of the deal signed. The company has a total liability of Rs 1930 crore in SsangYong – Rs 980 crore in equity and Rs 930 crore in terms of debt.