Share-swap deal to see local firm get 13% in CIE Automotive. Spanish auto component company — CIE Automotive will acquire stakes in Mahindra Group’s automotive component businesses, which are held under its “Systech Sector”. The nature of the deal invdolves share swaps between the two companies, wherein CIE, through its Brazilian subsidiary Autometal, will acquire 46-52% stakes in Systech (depending on the response to the open offer) for a sum of 100 million Euros (Rs 766 crore), while Mahindra will acquire 13.5% stakes in CIE parent, making it the second-largest shareholder. As a part of the transaction, Mahindra will merge all its auto components businesses into its Mahindra Forgings unit. Mahindra Systech Companies, which has around 8-10 component units in it, and CIE, will merge into one entity, which will called as Mahindra CIE Automotive, where the Spanish company will hold around 51%, Mahindra 20%, while the rest will be owned by private investors. Mahindra CIE will continue to be listed on the Bombay Stock Exchange and the National Stock Exchange. The entire process will take around 12-14 months. The listed Mahindra units in which CIE will buy stakes are Mahindra Forgings, Mahindra Composites and Mahindra Ugine Steel. Mahindra and CIE have been in talks for almost 2 years for potential stake sale. The deal is expected to help increase global footprint for both entities. “This will help us achieve globalisation and give us visibility into the global supply chain,” said Anand Mahindra, chairman of the Mahindra Group. seema
Posted on: Sun, 16 Jun 2013 07:18:42 +0000
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