Ssangyong shares plunge on denial of stake hike

Shares of Ssangyong Motor Co. nosedived nearly 10 percent Friday after the company denied a media report that its parent firm Mahindra & Mahindra of India is planning to jack up its stake in the carmaker.

Earlier this week, an Indian news outlet reported that Mahindra would be increasing its stake in Ssangyong from the current 72.85 percent to 85 percent, with plans to expand it to nearly 100 percent by the end of the year.

"We've checked with the Mahindra headquarters in India, and it's been confirmed that the report is groundless," a Ssangyong official said.

Following the denial, Ssangyong shares closed 9.5 percent down on the Seoul bourse Friday.

Ssangyong shares shot up after the initial news report, jumping 14.61 percent Thursday from a day earlier.

In 2011, Mahindra & Mahindra acquired its controlling stake in Ssangyong, the smallest carmaker in South Korea. (Yonhap)