Mahindra & Mahindra has received the green light from the Reserve Bank of India to reduce its ownership in Korean automaker SsangYong Motor, putting the sale process with the potential investor on fast track, according to people privy to the development.
The maker of XUV500 and Scorpio has got a nod from the country’s central bank to reduce its stake in Ssangyong to 25 per cent from the current 75 per cent through capital reduction. A Mahindra spokesperson declined to comment, redirecting the query to a spokesperson at the Korean subsidiary.
SsangYong filed for court receivership in December 2020, and the court decided the autonomous restructuring support (ARS) programme before putting it under rehabilitation. The rehabilitation process is basically debt readjustment, which may include restructuring of workforce.
Mahindra had earlier decided to shelve its plans to infuse $400 million equity in SsangYong. Mahindra had paid Rs 2,100 crore, or $463 million, for the purchase of SsangYong a decade ago.
Source: Business-Standard