Ruias to bid for Ssangyong 'only if price is right'
16 June 2010
In the race to acquire sports utility vehicle maker Ssangyong Motor Co, Ruia Group chairman P K Ruia said on Tuesday that he would bid for the ailing South Korean company only if the due diligence exercise currently on establishes that it is worth taking and the price was right.
Addressing a press meet after the annual general meeting of group flagship Dunlop India in Kolkata, he said, ''We have only given the intention to acquire the company and we have been shortlisted. The process of due diligence, on since 7 June, will be over by June-end and then we will decide. We will move ahead if the target comes at the right price.''
On the competition that Ruia faces from established automakers like Mahindra & Mahindra and global majors like Renault, which are also in the fray, he said that he was not in a race with anybody.
He also felt that there was no logic in the current valuation, which was too high. Liabilities were estimated at around $700 million.
The deal, if it happens, would be through a group investment arm, Ruia said. He added that a special purpose vehicle (SPV), which will include Dunlop India and Falcon Tyres, would be formed if it were to go ahead and bid for the Korean automaker.
The Ruias and Mahindra & Mahindra are the two Indian entities that have expressed interest in acquiring Ssangyong, which has been undergoing court-led restructuring since 2009 after suffering heavily due to the downturn in the auto industry in 2008-09.
''Now our interest in Ssangyong Motor is through one of the group's investment companies, and if the group moves ahead towards acquiring the company, then other companies (of the group) will also join in the SPV to acquire the shares,'' he said.