India’s key automotive company Mahindra & Mahindra Limited (M&M) declared on Monday, August 18, that it is thinking about acquiring a 51 per cent stake in the newly formed joint venture (JV) with Jiangsu Yueda Yancheng Tractor Manufacturing Co. of China. The Jiangsu Yueda Yancheng Tractor Manufacturing Co. is ranked as the Number 3 tractor manufacturing firm in China.
It was further announced by M&M that it is going to invest $26 million in this JV that will buy out the tractor related assets and liabilities of Yueda’s for $50 million. The 51 per cent in the JV will be held by M&M through its subsidiary, Mahindra Overseas Investment Company (Mauritius). This acquisition will propel the Mahindra & Mahindra Company closer to its goal of attaining the number one rank internationally.
The M&M infact is already into the business of manufacturing tractors in China through its JV with Jiangling Motors, the Mahindra China Tractor Co, in which it owns a whooping 80 per cent stake. ‘For a long time we have aspired to become the No. 1 tractor manufacturer in the world. With this new alliance, we would be able to achieve that goal more rapidly’, said Anand Mahindra, VC and MD, M&M.
