Mahindra to acquire 58.96% stake in SML Isuzu for Rs 555 crore

Mahindra aims to strengthen its presence in the >3.5T segment, where it currently has a market share of 3%.

Mahindra & Mahindra has announced that it will acquire a 58.96% stake in SML Isuzu at Rs 650 per share, which is an outlay of Rs 555 crore.

Mahindra will acquire the entire stake of 43.96% held by SML promoter Sumitomo Corporation. It will also acquire the 15% stake held by Isuzu Motors Ltd., which is the public shareholder of SML. Mahindra will also launch a mandatory open offer for the acquisition of up to 26% stake from eligible public shareholders of SML in accordance with the SEBI Takeover Regulations.

With this acquisition, Mahindra aims to strengthen its presence in the >3.5T segment, where it currently has a market share of 3%, as opposed to 52% in the <3.5T segment. This acquisition will double the market share to 6%. The company plans to further increase its market share to 10-12% by FY2031 and 20% by FY2036.

Incorporated in 1983, SML Isuzu is a market leader when it comes to the ILCV Buses segment, with around 16% market share. In FY2024, the company reported an operating revenue of Rs 2,196 crore and EBITDA of Rs 179 crore.