M&M gets NCLT approval to merge Mahindra Electric

16 Jan 2023 , 09:43 AM

The merger of Mahindra Electric Mobility and Mahindra & Mahindra has been approved by the Mumbai bench of the National Company Law Tribunal (NCLT).

With an increasing emphasis on electric vehicles, the proposed consolidation will bring the entire automotive value chain of the Anand Mahindra-led group under one umbrella (EVs).

Before the tribunal’s decision, Mahindra Group advocates Hemant Sethi and Devanshi Sethi argued that the company planned significant investments in the EV business to scale up operations and develop a robust EV product pipeline, for which the proposed consolidation would be critical.

The companies also claimed that M&M’s higher credit rating would result in significant savings in financing costs for the investment.

The companies argued that Mahindra Electric Mobility (MEML) has expertise in Electric Vehicle technology, while Mahindra & Mahindra (M&M) has expertise in automotive design, engineering and manufacturing, sourcing network, and sales and marketing. Therefore, this merger will bring this entire value chain under one umbrella.

At around 9.38 AM, Mahindra & Mahindra was trading 0.75% lower at Rs1,318.15, against the previous close of Rs1,328.15 on NSE. The counter opened at Rs1,333 and touched an intraday low of Rs1,313.40 so far.