The Ruia Group, makers of the Dunlop brand of tyres, are among the bidders for cash-strapped Korean sports utility vehicle (SUV) manufacturer SsangYong Motor Co (SMC).
The struggling South Korean company, the smallest car maker in that country, has seen surprise bids from seven global companies, including the two from India and French automotive giant Renault, through a subsidiary.
SsangYong has a market share of 2 per cent in South Korea and has suffered substantial losses over the past few years. It reported a net loss of 25.8 billion won (Rs100 crore) in the first quarter of this year. China's automobile major Shanghai Automotive Industry Corp (SAIC), which paid $500 million in 2004 to acquire nearly 49 per cent in debt-laden SMC, is its current promoter.
SAIC now owns just 10 per cent in SsangYong. The Korean company has been stuck in a court-led restructuring process since early 2009.
Sources in the industry said both M&M and the Ruia Group had submitted a letter of intent (LoI) for buying SsangYong, whose valuation has been pegged between $300 million and $500 million (Rs 1,400 crore-Rs 2,300 crore) by the media in Korea. While M&M has refused to comment, the Ruias have confirmed their bid.
SMC makes Rexton and Kyron SUVs and the Chairman sedan. Due to lack of availability of fresh investments, slumping demand for new vehicles, rising competition in the domestic market over the last two years and lack of focus from SAIC, the company has been put on the block.