Ssangyong Jumps After Mahindra Takeover Approved by Antitrust Commission
Ssangyong Motor Co., the South Korean automaker under bankruptcy protection, rose the most in four months in Seoul trading after Mahindra & Mahindra Ltd.’s takeover plan was approved by Korea’s antitrust regulator.
Ssangyong jumped by the daily limit of 15 percent, the most since June 24, to 10,500 won at the 3 p.m. trading close on the Korea Exchange, while the benchmark Kospi index fell 1.3 percent. Mahindra rose as much as 1.7 percent to 745.3 rupees in Mumbai.
The planned acquisition of Ssangyong by India’s largest sport-utility vehicle maker was approved today by South Korea’s Fair Trade Commission, which said in an e-mailed statement the combination of the two companies is unlikely to hurt competition in the domestic market. Mahindra, the maker of Scorpio SUVs, is seeking to benefit from the South Korean automaker’s technology and international sales network.
“It’s a procedural step for Mahindra to pursue the Ssangyong deal,” said Song Sang Hoon, head of research at Kyobo Securities Co. in Seoul. “How much synergy the takeover will bring to Ssangyong remains to be seen.”
Ssangyong expects the FTC’s approval to help speed progress of the ongoing talks with Mahindra to close the acquisition, Chung Mu Young, a spokesman for the Pyeongtaek, South Korea- based carmaker, said by telephone. Roma Balwani, a spokeswoman for Mahindra, declined to comment on the FTC’s statement.
Mahindra, which was named the preferred bidder for Ssangyong in August, hopes to complete the acquisition as early as February after signing the final agreement by year-end, Anand Mahindra, vice chairman of the Indian automaker, said on Oct. 13.
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