Shares of truck-bus manufacturing company SML Isuzu Limited hit a lower circuit of 10% on 28 April. Mahindra & Mahindra Limited (MM) announced that it will buy stake in the company. This deal is worth ?555 crores. The shares have fallen after this announcement. Mahindra & Mahindra has entered into an agreement to buy 58.96% stake in Isuzu at a price of ?650 per share. Along with this, Mahindra & Mahindra will also bring an open offer to buy 26% stake at ?650/share as per the takeover rules of market regulator SEBI. Shares of SML Isuzu are trading at ?1,596.10, down ?177.30 or 10.00%. Shares have fallen 16.60% in the last 5 days. 5 big things related to the deal… CEO said – This deal is important to achieve 5x growth Regarding this deal, Mahindra Group CEO and MD Dr. Anish Shah said – This acquisition is an important milestone for the company’s vision to achieve 5x growth. He said, it fits perfectly with our capital allocation strategy. At the same time, Rajesh Jejurikar, Executive Director and CEO of MM’s Auto and Farm Sector, said – This deal will strengthen Mahindra’s position in the commercial vehicle market. This will help us increase market coverage and better utilize manufacturing capacity. The company was established in 1983 as Swaraj Vehicles Limited. SML Isuzu Limited is a Chandigarh-based commercial vehicle manufacturer, which was established in 1983 as Swaraj Vehicles Limited. It specializes in the production of light and medium commercial vehicles, including buses, trucks, ambulances, and customized special-application vehicles. It was renamed Swaraj Mazda Limited in 1986 following technical and financial collaboration with Mazda Motor Corporation and Sumitomo Corporation, Japan. In 2011, it was renamed as SML Isuzu Limited, dropping the “Swaraj” brand following Mazda’s exit. Its vehicles are sold in the Indian market and select international markets. It has a market share of 16% in the commercial vehicle segment.
