The Competition Commission of India (CCI) has given its approval for Sajjan Jindal-promoted JSW Group’s proposed acquisition of up to 38 % stake in MG Motor India.
“The Acquirer is a newly incorporated entity and is not engaged in any activities as on date. It is a wholly owned subsidiary of JSW International Tradecorp Pte. Limited and belongs to JSW Group,” the CCI stated.
“The Target is a company incorporated in India, engaged in the automobile original equipment manufacturing business and after sale services. The Target is primarily engaged in the manufacture and sale of passenger cars (including electronic vehicles) under the Target’s brand ‘MG’,” it further said.
In November 2023, ET had reported that the JSW Group had inked an agreement with China’s SAIC Motor to acquire 35 % stake in Indian subsidiary MG Motor India to jointly run automobile operations in the country.
As per the agreement reached between the two companies, JSW Group will acquire 35 % stake in SAIC’s Indian subsidiary MG Motor India for an undisclosed amount. The Chinese auto major will continue supporting the joint venture with advanced technology and products to deliver mobility solutions to the Indian consumer.
The acquisition comes amid increased scrutiny by the Indian government on investments made by China amid heightening geopolitical tensions. The stake sale to JSW Group will enable the maker of Hector and Astor to expand operations in the local market, and also give a foothold to the Indian conglomerate in the fast-evolving electric vehicle segment in India.
The shareholder agreement and the share purchase and subscription agreement were signed between SAIC President Wang Xiaoqiu and JSW Group’s Parth Jindal at MG Motor’s office in London.
Wang Xiaoqiu, President, SAIC Motor, said, “In the growing Indian automotive market, both partners shall work closely to bring in the best of innovation, in creating greener and smarter mobility products and services for our consumers, seizing market opportunities, continuously expanding the brand influence and market share of our products, and achieving greater success for MG in India.”
Parth Jindal had said, “Our strategic collaboration with SAIC Motor aims to grow & transform the MG Motor operations in India with a focus on green mobility solutions. The joint venture paves the way for bringing world-class technology-enabled futuristics suite of automobile products including the new generation of intelligent connected NEVs and ICE vehicles. The JV’s focus on broader localisation initiatives will yield financially accretive synergies through economies of scale while providing the highest level of customer service to the Indian consumer.”
One of the key focus areas of the joint venture, the duo had said, will be to pursue the development of the electric vehicle ecosystem and to take a leadership position in this space. SAIC Motor and JSW Group said they aim to create strategic synergies by bringing together resources in the field of automobiles and new technology. The joint venture also plans to undertake multiple new initiatives including augmenting local sourcing, improving charging infrastructure, expansion of production capacity, and introducing a broader range of vehicles with a focus on green mobility.
In May 2023, MG Motor India had said it is looking at diluting majority stake in the company to Indian entities to fund its expansion plans in the country over the next five years. As part of its growth plan, MG Motor India plans to invest Rs 5000 crore, which will be utilised, among others, to establish a second manufacturing facility in Gujarat. The new unit is intended more than double the company’s installed capacity to a total of 300,000 units, from the current 120,000 units.
