This announcement was made on Saturday following which Mahindra Forgings merged businesses will be renamed Mahindra CIE Automotive. Spanish components maker CIE will hold 51% and Mahindra will hold about 20% with the balance being held by institutions and public shareholders. Mahindra CIE will be one of the top 25 global auto component suppliers with operations in North America to Asia while expected annual sales are estimated to the tune of $3 millionn.
CIE will also acquire majority stakes in Mahindra listed and unlisted auto components units. The company will be purchasing a 25% stake and will need a further 26% from the public. Mahindra has long been scouting for an overseas investor. The company has strived to create a strong presence outside the country in realising their ambition to become a global player.
“Eight years ago, we at Mahindra set out to build an Indian automotive supplier with a global footprint and this drove a series of acquisitions in India and Europe for us. We have been listening closely to our customers who have asked to step up our globalisation efforts and follow them around the world. This Grand Alliance with CIE enables us to “Rise” above competition, quickly extends our reach into new geographies, and grow our collective product portfolio in the coming years,” said Anand Mahindra, Chairman of the Mahindra Group.
Anton Pradera, Chairman of CIE Automotive said “CIE’s leadership and shareholders have a strategy to develop India as the gateway to the Asian market. We have been impressed by the promise of the Indian automotive market and the growing emergence of India as a key global production hub for small cars. In Mahindra, we found a partner that has a multi-technology portfolio similar to ours and shares the same business values. So while we are happy to see CIE gaining an entry to India, we are equally pleased to have M&M as one of CIE’s largest shareholders.”
Jesus Maria Herrera, CEO of CIE Automotive and Chairman of Autometal said “CIE’s focus on growth with operational excellence is a value shared with the Mahindra Group. And as we join hands to become a bigger and better supplier, we see a bright future ahead of us.”
Hemant Luthra, President of Mahindra’s Systech Sector said “Systech businesses are the result of acquisitions and alliances that we have struck around the world as we sought to quickly expand in the components business with our unique “Art to Part” proposition. This Alliance with CIE dwarfs everything we have done in the past and marks the next bold step towards global supplier consolidation.”