Mahindra to invest $900m in SsangYong

Mahindra to invest $900m in SsangYongIndian automotive major, Mahindra & Mahindra has said that it is planning to invest about $900 million during the coming four to five years its SsangYong Motor unit.

The company is looking to develop three new vehicles and six engines at its unit in South Korea. Pawan Goenka, President for Automotive & Farm Equipment sectors, M&M said that the funds for the investment will come from internal accruals, fresh equity and debt.

"That will happen over the next year-and-a-half. Beyond that, we have not made complete plans on how the investments will take place," he said. He pointed out that the sales at SsangYong have risen since it was acquired by the company by 6-7 per cent in the Korean market.

SsangYong Motor is the fourth largest automobile manufacturer in Korea. M&M had acquired 70% share in the company in February 2011 after it was named the preferred bidder in the sale of the company. Mahindra had paid about $463.6 million for the majority stake in the company.

Goenka said that the unit will become a 100 per cent subsidiary of M&M and naming of the new company will be done soon.