JSW Group acquires 35 per cent stake in MG India from SAIC
MG Motor India has announced a joint venture with the JSW Group. As per the terms of the agreement, JSW will acquire a 35 per cent stake in MG Motor India from SAIC Motor, the parent company of MG Motor in India. The acquisition's exact cost, however, has yet to be disclosed.
The agreement was signed at the MG Office in London by SAIC President Wang Xiaoqiu and Parth Jindal of JSW Group. The agreement states that the two parties will pool automotive and emerging technology resources. The joint venture will also launch several new initiatives, such as increased local sourcing of components, improved charging infrastructure, increased production capacity, and the introduction of a broader range of vehicles with a focus on green mobility.
This news comes after MG Motor was questioned in November 2022 about the company losing money in its first year of operation.
How will it benefit JSW Group and SAIC Motor?
The joint venture is a win-win situation for all parties. For a long time, JSW has hoped to break into the automotive industry. This joint venture will allow them to enter the market with a well-established brand that MG is. On the other hand, MG Motor, a subsidiary of SAIC Motor, a Chinese entity, that was having difficulty raising funds because the Indian government had imposed certain trade restrictions with China, now gets access to funds and resources from the JSW group. The funds brought in by the JSW Group in exchange for a 35 per cent stake will assist MG Motor in running their operations smoothly and expanding them, so expect the MG portfolio in India to expand in the coming years.
MG Motor India has invested approximately Rs 7,000 crore in India. It currently has 350 dealerships across India and plans to increase that number to 400 by the end of this year.