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Last Updated : Sep 21, 2020 04:56 PM IST | Source: Moneycontrol.com

US-based HAAH Automotive proposes $258 million investment in M&M-controlled SsangYong: Report

M&M, the largest shareholder of Ssangyong with a 75 percent stake, is understood to be considering the offer

 
 
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HAAH Automotive, a US-based automobile distributor, is proposing to invest $258 million into the troubled Korean carmaker SsangYong Motor Co to acquire Mahindra & Mahindra’s (M&M) significant stake in the company, an investment banking source told Korean Investors, a news agency.

Last week, HAAH Automotive submitted a proposal to M&M that it is willing to invest in Ssangyong if it means its stake is large enough to control the Korean maker of sport utility vehicles, the agency added.

M&M, the largest shareholder of Ssangyong with a 75 percent stake, is understood to be considering the offer. When contacted, M&M declined to comment on the story.

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In the proposal, HAAH Automotive also presented some conditions for its investment, such as a deferral of Ssangyong’s debt repayment to its creditors until the automaker is fully normalised, Korean Investors claimed quoting sources.

M&M has been looking for a partner for managing SsangYong since the beginning of 2020. In June, M&M said it was ready to cede control of SsangYong after it refused to pump in further investments into the cash strapped carmaker.

The Mumbai-based company had indicated at that time that it does not intend to exit SsangYong completely, but reduce its stake and become a minority investor.

In April, the M&M board declined to inject any more funds in to SsangYong after the Korean company sought an infusion of $406 million. Since then, SsangYong has liquidated some non-core assets to generate working capital while keep costs down.

HAAH Motors Holdings is a privately held company located in Irvine, California. China’s Chery Automobile Co, has partnered HAAH to assemble and sell SUV in the US under the brand Vantas.
First Published on Sep 21, 2020 04:56 pm
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