Topic > Mergers, Acquisitions and Corporate Restructurings

Mergers, Acquisitions and Corporate Restructurings – Project ReportShort SummaryMahindra & Mahindra Ltd. (M&M), of the $16.2 billion Mahindra Group, has struck a deal with troubled Ssangyong Motor Company (SYMC) to acquire a majority stake on August 2, 2010. The agreement was concluded to enable Ssangyong Motor Company to strengthen its research and development, increase corporate competitiveness, and encourage investment in product development and increase global sales with the help of a partner (Mahindra & Mahindra) with strong financial capacity and commercial commitments in different markets. M&M's plan was to support Ssangyong's strong technological capability with its expertise in sourcing and marketing strategy in order to emerge as a competitive global utility vehicle player by leveraging the synergies achieved and investing a new product portfolio for Ssangyong. This paper attempts to critically analyze the acquisition agreement between M&M and Ssangyong Motor Company (SYMC). This article studies the history of both companies and the situations that led to the agreement. The document attempts to valorise SYMC using the DCF methodology and to exploit the synergies foreseen by the agreement. The analysis shows that the decision to proceed with the acquisition was correct and the amount paid for the purchase of the stake is justifiable.Keywords: M&M-Ssangyong agreement, mergers and acquisitions, DCF evaluation, synergy evaluationIndexIntroduction ……… …… …………………… Company history ……………….. Analysis of negotiations ……… ………………….. Evaluation ……………………………… …………………………………… Post acquisition scenario … ……………………….. References ……………….............. ....................................In. ..... half of the paper ......d by 18% Demand slowdown in China and Korea can be overcome by improving product portfolio in India Table 1: Company Benefits Post Acquisition Source: Analytics Team REFERENCES “Damodaran On Valuation” , Second Edition, Wiley India http://www.rediff.com/business/slide-show/slide-show-1-auto-how-mahindra--mahindra-turned-around-ssangyong/20130627 .htm#4http:// economictimes.indiatimes.com/news/news-by-industry/auto/automobiles/mm-to-pay-rs-2105-crore-to-acquire-70-in-ssangyong/articleshow/6973570 .cmshttp://en. wikipedia.org/wiki/SsangYong_Motor_Companyhttp://www.dhruvacollege.net/images/stories/vidwat/vidwat%20journal%20vol%204%20iss%202.pdfhttp://economictimes.indiatimes.com/fullcover.cms?keyword= Mahindra-SsangYong%20Dealhttp://investing.businessweek.com/research/stocks/financials/financials.asp?ticker=003620:KS