New Delhi: Mahindra & Mahindra-owned Korean SsangYong Motor Enterprise has just lately witnessed a bounce in its share rate while touching the upper circuit of 5,620 South Korean Received (SKW) to finish at SKW4,985 for every ordinary share on Tuesday, as trader interest and information of a possible takeover did the rounds.
The car company’s share rate has acquired about 120% in the past 3 months and forty six% in the past 7 days itself.
As for every a Korean media report on Monday, SsangYong Motor options to signal an expenditure agreement with the US-primarily based HAAH Automotive Holdings someday this 7 days. HAAH is a California-primarily based motor vehicle distributor and is partly owned by China’s Chery Auto Enterprise.
Mahindra & Mahindra had previously declared that it will not make any even more investments in the ailing SUV maker and preferred to give up its managing stake after being not able to turn about the operations of the firm. The company’s board moved a distinctive resolution at its AGM to decrease its shareholding in SsangYong to much less than fifty%, an indicator of a new trader coming in instead than a complete offer-out.
Now, Mahindra retains seventy four.65% stake in SsangYong. It has invested additional than USD110 million since it first acquired a managing stake in the decline-making company nearly a 10 years back. Its board has been from any even more expenditure in the Korean entity.
By March-finish, SsangYong has been in financial disaster with USD322.four million brief-expression financial loans, to be repaid within a year, value SKW167 billion from JP Morgan, BNP Paribas and Financial institution of The united states.
In the facial area of mounting money owed and mounting losses, the firm had managed to offer one particular of its assistance centres in the Guro district in Seoul. By way of the sale, it managed to elevate near to USD147 million
Meanwhile, Ssangyong reported a internet decline of USD157 million for the first quarter of 2020, its thirteenth consecutive quarterly decline that tends to make it a large liability for the Indian proprietor.
In 2019 SsangYong’s annual profits fell 6.5% to 132,799 units from 141,995 units a year previously owing to reduce need. Throughout the existing interval of January to March 2020, profits for the firm fell 31% to 24,139 units from 34,851 all through the similar interval in 2019.
Above the past 5 years, returns have been pretty dismal, when the share rate was down 56% in the interval. The firm saw a lacklustre progress with its revenues growing by one.% for every year.
SsangYong’s lineup of automobiles involve its flagship G4 Rexton, Tivoli, Korando and Rexton Sports activities.
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