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Mahindra & Mahindra Ltd on Saturday announced that it has agreed to acquire a 58.96% stake in SML Isuzu Ltd (SML) at Rs 650 per share, which is an outlay of Rs 555 crore. In addition, M&M will make an open offer under the SEBI Takeover Regulations.
The proposed acquisition is a step towards establishing a strong presence in the over 3.5-tonne commercial segment, where M&M has a 3 per cent market share. On the other hand, the M&M has a 52% market share in the less than 3.5-tonne LCV segment.
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M&M said this acquisition will double the market share to 6 per cent, with a plan to increase this to 10-12 per cent by FY31 and over 20 per cent by FY36.
Incorporated in 1983, SML Isuzu is a listed company with well-recognized brands, a strong vintage, and pan-India presence in the Trucks and Buses segment. SML has a market-leading position in the ILCV. In the buses segment, SMl has around 16% market share. The company reported operating revenue of Rs 2,196 crore and EBITDA of Rs 179 crore in FY24.
The company in the statement said it has profitable operations, frugal manufacturing, and strong engineering capabilities. SML offers significant potential to unlock value through synergies in cost, network, brand, manufacturing, talent, and product complementarities.
As part of the transaction, M&M would acquire the entire stake of 43.96% held by Sumitomo Corporation, promoter of SML, and separately also acquire a 15% stake held by Isuzu Motors Ltd, public shareholder of SML, for an aggregate consideration of Rs 555 crore. M&M would also launch a mandatory open offer for the acquisition of up to 26 per cent stake from eligible public shareholders of SML in accordance with the SEBI Takeover Regulations.
Anish Shah, Group CEO & MD of the Mahindra Group, said, "The acquisition of SML Isuzu marks a significant milestone in Mahindra Group's vision of delivering five-fold growth in our emerging businesses. This acquisition is aligned with our capital allocation strategy for investing in high potential growth areas which have a strong right to win and have demonstrated operational excellence."
Rajesh Jejurikar, Executive Director and CEO, Auto and Farm Sector, Mahindra & Mahindra Ltd, said, "SML brings a strong legacy, a loyal customer base, and a credible product portfolio that complements Mahindra's existing offerings in the trucks and buses segment. This acquisition is a pivotal step toward our ambition to become a full-range, formidable player in commercial vehicles by enhancing market coverage, unlocking operating leverage through platform consolidation, a unified supplier and network base, and better plant utilization. Together, we are well-positioned to scale rapidly and drive profitable growth."
The transaction, including the open offer, is subject to the approval of the Competition Commission of India and is expected to complete within 2025 in accordance with SEBI Takeover Regulations. Kotak Investment Banking is acting as the financial advisor to M&M and manager to the open offer. Khaitan & Co acted as legal advisor to M&M.
The proposed acquisition is a step towards establishing a strong presence in the over 3.5-tonne commercial segment, where M&M has a 3 per cent market share. On the other hand, the M&M has a 52% market share in the less than 3.5-tonne LCV segment.
Also Read: Maruti Suzuki e-Vitara Launch in September 2025, Hustler SUV To Follow
M&M said this acquisition will double the market share to 6 per cent, with a plan to increase this to 10-12 per cent by FY31 and over 20 per cent by FY36.
Incorporated in 1983, SML Isuzu is a listed company with well-recognized brands, a strong vintage, and pan-India presence in the Trucks and Buses segment. SML has a market-leading position in the ILCV. In the buses segment, SMl has around 16% market share. The company reported operating revenue of Rs 2,196 crore and EBITDA of Rs 179 crore in FY24.
The company in the statement said it has profitable operations, frugal manufacturing, and strong engineering capabilities. SML offers significant potential to unlock value through synergies in cost, network, brand, manufacturing, talent, and product complementarities.
As part of the transaction, M&M would acquire the entire stake of 43.96% held by Sumitomo Corporation, promoter of SML, and separately also acquire a 15% stake held by Isuzu Motors Ltd, public shareholder of SML, for an aggregate consideration of Rs 555 crore. M&M would also launch a mandatory open offer for the acquisition of up to 26 per cent stake from eligible public shareholders of SML in accordance with the SEBI Takeover Regulations.
Anish Shah, Group CEO & MD of the Mahindra Group, said, "The acquisition of SML Isuzu marks a significant milestone in Mahindra Group's vision of delivering five-fold growth in our emerging businesses. This acquisition is aligned with our capital allocation strategy for investing in high potential growth areas which have a strong right to win and have demonstrated operational excellence."
Rajesh Jejurikar, Executive Director and CEO, Auto and Farm Sector, Mahindra & Mahindra Ltd, said, "SML brings a strong legacy, a loyal customer base, and a credible product portfolio that complements Mahindra's existing offerings in the trucks and buses segment. This acquisition is a pivotal step toward our ambition to become a full-range, formidable player in commercial vehicles by enhancing market coverage, unlocking operating leverage through platform consolidation, a unified supplier and network base, and better plant utilization. Together, we are well-positioned to scale rapidly and drive profitable growth."
The transaction, including the open offer, is subject to the approval of the Competition Commission of India and is expected to complete within 2025 in accordance with SEBI Takeover Regulations. Kotak Investment Banking is acting as the financial advisor to M&M and manager to the open offer. Khaitan & Co acted as legal advisor to M&M.
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