MG Motors India Selling Stakes
SAIC-owned MG Motors seeks to sell a majority stake in its Indian car business – Is said to be in advanced negotiations so as to close the deal by the end of this year.
MG Motors a sister company of SAIC Motor of China, with its manufacturing plants in Halol Gujarat, is planning to water down its stakes in the company to an Indian entity. The news breaks down exactly at the point when India and China face swelling tensions.
Chinese Companies facing problems
Many companies with major Chinese stakes are facing obstructions with the Government of India in relation to various factors. This could be in the form of approvals for fresh investments, sourcing of spare parts from China, duties and taxes, etc.
MG Motor has also sought government approval in terms of raising funds from its parent company for added investments into its Indian operations. It has been for 2 years now that this sanction has been put forth but to no success. Hence the company has now decided to raise capital via other means, particularly through Indian entities.
Reliance in the EV industry
The automaker stated that it plans to raise around Rs 5,000 crores capital over the next 2-4 years for this second round of growth in India for which it will offer a majority stake to local partners and investors. As of date, the company sees likely investors in the form of Reliance Industries, Hero Group, Premji Invest, and JSW Group.
MG Motor’s Upcoming Portfolio
However, the focus of the expansion plan lies in expanding MG India’s EV portfolio by 2028. The company has announced that it will launch four to five new all-electric models in the next five years and wants to achieve 65 to 75 percent of revenue from its EV portfolio in the future.
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