New Delhi : Automobile major Mahindra & Mahindra's (M&M) board is likely to approve the company's bid for ailing Korean SUV maker Ssangyong at its meeting on Aug 5.

According to two people with knowledge of the matter, the company's bid is expected to be in the region of $300-450 million. The bid is likely to be financed through a combination of debt and internal accruals. Kotak Mahindra Bank is likely to finance the debt along with other third party bankers that have not yet been finalised.

M&M is not looking at pledging its shares or opting for an equity dilution to raise the money. "M&M's balance sheet and debt equity ratio are strong enough to raise the money on its own along with some debt component," said a person close to the deal. Some board members "had raised apprehensions" about the Ssangyong deal earlier and had asked for additional information.

M&M has been conducting due diligence for the past one month. The company's current cash reserves stand at `5,000 crore. Its debt equity ratio is 0.3, which can go up to 0.6 or 0.7. However, Pawan Goenka, president - auto & farm equipment of M&M, refused to comment.

Last week, M&M had deferred a decision on the Ssangyong bid saying it would take a call closer to the August 10 deadline given by the Korean company as it was "awaiting some additional information".

M&M, which in recent years has become an active M&A player, had checked out Ssangyong nearly seven years ago, before deciding against a bid. This time round, it is one of the six bidders, including Renault-Nissan and the Ruia Group of Kolkata, that have been shortlisted to bid for the South Korean company. Ssangyong has been under court-led restructuring since early 2009.

This year, M&M has already bought out electric carmaker Reva Car Company and Renault's stake in their joint venture Mahindra Renault. M&M vice-chairman Anand Mahindra is building a diversified business empire by acquiring companies and expanding capacities. His buyouts include the scandal-hit Satyam Computer and Punjab Tractors. He is seeking to rule the utility vehicle market, which he already dominates with the Scorpio, Xylo and Bolero models.

Ssangyong has a troubled past, with Chinese firm Shanghai Automotive failing to turn it around in the past few years. It cut its stake in the Korean company to 3.8%, from as high as 51% due to the failure.

If Mahindra succeeds in the acquisition of the bankrupt Ssangyong, it could add sports utility vehicle Rexton and premium sedan Chairman to its portfolio. Top M&M officials have said that Ssangyong fits into its global aspirations of becoming a leading SUV player in the world.