MG in talks with RIL, Hero for stake sale in Indian operations – Times of India
The move by MG, a British car brand owned by Chinese auto giant SAIC, aims to get regulatory ease in India as the company faces difficulties in getting approvals for fresh investments from its parent due to restrictions following IndoChina tensions. Through the entry of wellheeled and trusted local partners, the company looks to embark on its next phase of growth, where it needs investments of Rs 5,000 crore to set up a factory in Gujarat and drive in new cars — most of them will be electric.
“Hectic discussions are on with the Indian companies and MG Motor is looking to close a deal by the end of this year,” one of the sources said, adding talks are at an “advanced stage”, especially as MG wants funds “almost immediately” to kick off the next phase of expansion. “Negotiations are on and the effort of MG management is to get a credible partner, while managing attractive valuations.”
MG Motor India termed questions around the talks with Reliance, Hero Group, Premji Invest and JSW as “speculative”. Detailed questionnaires sent individually to the Indian companies remained unanswered at the time of going to the press.
MG Motor India CEO Rajeev Chaba refused to answer questions around potential suitors and talks with them. However, he said the company is planning an aggressive investment plan as part of a fiveyear business road map. “This will see the company invest Rs 5,000 crore by 2028, increase production from 1.2 lakh units annually to 3 lakh units, drive in four to five new cars, work on battery assembly units within the Gujarat plant and explore cell manufacturing and hydrogen fuelcell technologies through joint ventures and thirdparty manufacturing.”
The company, which sells models such as the Hector and Gloster SUVs and ZS and Comet electrics, also wants to boost localisation on products, while planning to increase employment by about 20,000 (direct and indirect) by 2028.