According to a report in The Economic Times (ET), industrialist Sajjan Jindal intends to acquire stock in MG Motor India. The Chinese automaker SAIC Motor owns 100% of the subsidiary MG Motor India. According to the article, the joint venture will not have any impact on the listed companies of the Jindal group: JSW Steel and JSW Energy.
However, when questioned about the agreement, a JSW spokeswoman stated that the company had no remarks to make regarding market rumors, according to ET. MG Motor India has not yet offered any comments either.
The article states that Jindal will probably buy a 45–48 percent stake in MG Motor India. This would comprise a 5-8% share held by employees and dealers. According to the article, which cited numerous sources, SAIC will continue to own the remaining holdings in the business.
According to an ET story, Jindal and his son Parth were in China to meet with SAIC representatives and go over the specifics of the relationship. The conversations have been going on for a while, and they seem to be having a good result because both parties seem pleased with the terms.
The Indian government is pleased with the advances and is aware of the arrangement. According to ET, when the acquisition is finished, at least 51% of the company will still be owned by Indians.
Following that, MG Motor India will “become an Indian entity instead of a Chinese one, with an eventual India listing in the next few years,” the article added, quoting a senior government official.
The information that Sajjan Jindal intends to buy a share in MG Motor India has previously surfaced. The group denied having such plans on April 26, according to Business Standard.
Regarding the inquiry, “JSW in talks to pick up stakes in MG and BYD India,” the company stated in a press release, “We confirm that no such proposal as referred to in the news article has been placed for discussion of the Board or any of its committees.”
An analogous request for Indian ownership in the form of equity partnerships was made to Chinese smartphone manufacturers by the Indian government. In addition, the government had requested that these firms employ Indians in important positions like chief executive officer and chief financial officer, among others.
According to the sources mentioned above, MG Motor India is currently valued at $1.2-1.5 billion (Rs 9,800–12,300 crores), which is far less than what SAIC had initially requested ($8–10 billion).
In India, MG sells the electric Comet EV and ZS cars that were just released. The company’s product line also includes Astor, Hector, and Gloster.
