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| Sajjan Jindal, chairman and managing director of JSW group of companies, is reportedly set to own between 45 and 48 percent of carmaker MG Motor India, which is a wholly owned arm of the Shanghai-headquartered SAIC Motor, according to the Economic Times. His majority acquisition would make the company into an Indian entity, with the dealers and Indian employees owning around 5-8 percent. The parent company, SAIC, will hold on to the remaining percentage, the ET report cited multiple sources in the know. This acquisition plan will ensure that at least 51% of the company will be in Indian control, while the Chinese will become a minority partner with a maximum holding of 49%. |
| MG Motor India, the local subsidiary of the Chinese-owned passenger vehicle major, has come up with an ambitious plan to transform its business by 2028 amid Indian government’s onslaught on investments from the neighbouring country. After securing one per cent share of India’s passenger four-wheeler market in 2023, the company is now planning to bring in local owners in its bid to ‘Indianise’ the business. The foreign owners of the company are now planing to divest its majority stake to Indian partners within 2-4 years. For the same, it has already started scouting for buyers among Indian investors, including institutions, its local business partners and HNIs. “We will finalise the new investors-cum-owners of MG Motor India, who together would own more than 50 per cent of the company within FY24," Rajeev Chaba, CEO Emeritus, MG Motor India told the media today. The aim is to ‘Indianise’ the company that will, in turn, help it raise funds for the next phase of expansion through expansion in its production capacity. |
| "54 FDI proposals received during the past year and current year with investor/ beneficial owner from China/Hong Kong are pending for decision with government as on March 21, 2023," Sitharaman informed Parliament on Monday. The Indian government is not considering easing restrictions put in place a few years ago on foreign investments from countries that share land border with India, Sitharaman said. In 2020, India sought to limit investments from China as political tensions heightened between the two countries with its soldiers clashing at the disputed Himalayan region. The restrictions called for beneficial owners of a country sharing a land border with India to seek its government's approval for investments. The step was taken to prevent hostile takeovers of Indian companies when the country was severely impacted by the Covid-19 pandemic. |
| A non-resident entity can invest in India, subject to the FDI Policy except in those sectors/activities which are prohibited. However, an entity of a country, which shares land border with India or where the beneficial owner of an investment into India is situated in or is a citizen of any such country, can invest only under the Government route. |
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Originally Posted by GoBabyGo
(Post 5566988)
Do you see any such arrangements BYD has to do to stay in India. |
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Originally Posted by WorkingGuru
(Post 5567491)
This will discourage any new car makers from entering India and embolden the poor industry practices amongst the current ones. |
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Originally Posted by neerajku
(Post 5567468)
This looks like another Spice jet in the making. Crony capitalism at its best. What do they do know about Automobiles and even plain and simple Tech. If to happens it will not be good news. They may not transfer tech when they are not in control. India may be a big market but they have their own big one at home and why bother beyond a point about a hostile and unsafe market and unsympathetic authorities. They will ensure transition, gradually sell off or just limit to tech support on payment basis. |
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Originally Posted by GTO
(Post 5567512)
No political discussions please, but this is forced by the government. Similar to their muscling around with all the Chinese smartphone manufacturers. MG India has been desperate for money and its Chinese parent has no shortage of funds. But the government simply won't allow any further Chinese funding. MG has been raising debt, but there's a limit to that. We will see many more Indians in the MG India decision making team now. BYD is still small in India. It also depends a lot on the company's relationships & lobbying power in Delhi. But for now, if you are a Chinese company, don't expect any support from the Indian government. In fact, Chinese companies are outright harassed. Chinese ones, yes. Outside of China, every player that could have tried their hand in India has already done so. Some successfully, some not. |
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Originally Posted by GoBabyGo
(Post 5567558)
Thanks GTO - I agree "No Political Discussion here please". However, would like to understand from Management point of view, even if Indian company own some 51% stake (slightly more than majority stake for example), do you think Chinese Management will not dictate their terms in R&D, Design, Marketing, Product Planning, Positioning, Service & Spare parts Supply & Costing. |
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Originally Posted by Deepak George
(Post 5567652)
Quick update from CNBC-TV18. It's now not only JSW in the race to acquire majority share in MG motors but also Mahindra and Mahindra, Hinduja group, Hero group, Premji Invest among others. Mods - Please change the title if it makes sense. |
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Originally Posted by Deepak George
(Post 5567652)
Quick update from CNBC-TV18. It's now not only JSW in the race to acquire majority share in MG motors but also Mahindra and Mahindra, Hinduja group, Hero group, Premji Invest among others. Mods - Please change the title if it makes sense. |
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