Did Mahindra & Mahindra Acquire a 59% Stake in SML Isuzu for Rs 555 Crore?
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Synopsis
Mahindra & Mahindra's recent acquisition of a controlling stake in SML Isuzu marks a pivotal move in strengthening its foothold in the commercial vehicle market. With plans to double its market share, this strategic investment is set to reshape the competitive landscape of the automotive sector.
Key Takeaways
- Mahindra acquired a 58.96% stake in SML Isuzu.
- The acquisition cost was Rs 555 crore.
- SML Isuzu will be rebranded as 'SML Mahindra Limited'.
- Mahindra plans to increase its commercial vehicle market share significantly.
- Leadership changes have been made at SML Isuzu.
Mumbai, Aug 2 (NationPress) - Mahindra and Mahindra (M&M) has successfully finalized the purchase of a 58.96% controlling interest in SML Isuzu Limited for Rs 555 crore.
Following the necessary regulatory approvals, the company will be rebranded as 'SML Mahindra Limited'. Back in April 2025, M&M had entered into an agreement to acquire this stake at Rs 650 per share.
This acquisition encompasses the entire 43.96% stake owned by Sumitomo Corporation, the promoter of SML, along with a 15% stake held by Isuzu Motors Limited.
M&M intends to initiate a mandatory open offer to acquire up to 26% from eligible public shareholders, in accordance with SEBI Takeover Regulations.
The company has expressed that this strategic move is crucial for establishing a robust presence in the above 3.5-tonne commercial vehicle (CV) segment, where its current market share stands at 3%.
In contrast, M&M commands a 54.2% share in the sub-3.5-tonne light commercial vehicle (LCV) segment.
According to the company, “This acquisition is a significant milestone for M&M in solidifying its foothold in the >3.5T CV segment, where it currently holds a mere 3% of the market, compared to its commanding 54.2% in the Sub-3.5 tonne LCV segment.”
M&M anticipates that this acquisition will elevate its CV market share to 6% immediately, with aspirations to expand it to 10-12% by FY31 and surpass 20% by FY36.
In alignment with leadership changes, M&M has appointed Vinod Sahay as the Executive Chairman of SML Isuzu effective August 3, while Dr Venkat Srinivas will assume the role of Executive Director and Chief Executive Officer starting August 1.
Both individuals will maintain their existing positions within the Mahindra Group alongside their new roles.
SML boasts a national presence in the trucks and buses sector and holds a 16% market share in the intermediate and light commercial vehicle (ILCV) bus segment.
On August 1, shares of Mahindra & Mahindra concluded at Rs 3,160.20 on the Bombay Stock Exchange (BSE).
Point of View
It's imperative to recognize Mahindra & Mahindra's bold move in acquiring a significant stake in SML Isuzu. This acquisition not only bolsters M&M's position in a competitive market but also reflects a strategic vision for growth. While the automotive sector faces challenges, this step signals confidence and ambition. The nation's economic landscape will undoubtedly benefit from such assertive corporate actions.
NationPress
19/08/2025
Frequently Asked Questions
What percentage of SML Isuzu has Mahindra acquired?
Mahindra and Mahindra has acquired a controlling stake of 58.96% in SML Isuzu.
How much did the acquisition cost?
The acquisition cost Mahindra Rs 555 crore.
What will the new name of SML Isuzu be after the acquisition?
SML Isuzu will be renamed 'SML Mahindra Limited' after the acquisition.
What are Mahindra's plans for market share growth?
M&M aims to double its CV market share from 3% to 6% immediately and further grow it to 10-12% by FY31 and over 20% by FY36.
Who are the new leadership appointments at SML Isuzu?
Vinod Sahay is appointed as Executive Chairman, and Dr Venkat Srinivas will take charge as Executive Director and CEO.
