M&M says there are no plans to demerge passenger vehicle and tractor businesses
Mahindra and Mahindra have confirmed that they are going to continue as one with the auto and tractor business, following Tata Motors' demerging. of the passenger and commercial vehicle.
New Delhi: Mahindra & Mahindra have clarified that there are at present no plans to demerge their auto and tractor business. This follows after recent reports where the Economic Times claimed that the Indian carmaker was looking to restructure and separate the tractors, passenger vehicle and truck operations into different entities.
In their statement during an exchange filing said, "The Company has clarified this in the past and maintains that it sees much greater value from synergies by keeping these businesses within the M&M entity.”
What were the reports about M&M?
The Economic Times had noted that there were internal discussions at the preliminary state, which aimed to assess the ease of turning the M&M core divisions into standalone units. In the last five years, both automotive and farm equipment businesses have seen decent growth, which has made Mahindra’s position in the SUV and tractor segment quite strong.
The report quoted a senior executive close to development had saying that the focus remains on being prepared for the future and making all businesses independent.
The speculations come after Tata Motors recently separated their passenger and commercial vehicle units. The demerger became effective from October 1st and will separate the automotive major’s commercial vehicle and passenger vehicle listed into two different companies, with functions and management becoming independent as well.
For every share they own in Tata Motors on October 14, the record date, they will receive one equity share in the new CV company. By early November, TML Commercial Vehicles Ltd. is anticipated to go public.
Mahindra have been expanding their portfolio in both the ICE and EV sectors and recently introduced four concepts, showcasing the future direction of the company. In the SUV market, the company has covered most segment of the SUV market.