In the automobile industry, the mergers and acquisitions are common and the process is beneficial to both the acquired and the acquiring company. One of the major Indian auto makers, Mahindra and Mahindra recently acquired a Korean automobile company Ssang Yong Motor Company. Mahindra & Mahindra made an announcement recently that it has finished all the formalities pertaining to the acquisition of a majority of stake in Ssang Yong Motor Company.
The benefit that the M&M gets from this acquisition is the synergies can be increased while protecting their respective brands and ensuring quality. The council which is to be formed and comprises of representatives from both the companies is to work on different strategies and the council is going to focus on aspects such as global procurement, new product development and working on business strategies for penetrating key international markets.
They are also planning to produce joint product and technology development; synergy in purchase and operations of the companies globally. Mahindra is also planning to launch the Rexton and Korando-C in India. M&M has strong IT presence and it is planning to open finance system to enhance operations in Korea, this also helps the Korean company to increase its sales. M&M also proposed five points agenda which includes harnessing synergies between the two companies, focusing on financial stability and building human resources investing in the SYMC brand, strengthening the product line.