Mahindra Group ties up with CIE Automotive of Spain
The Mahindra Group and CIE Automotive S.A. of Spain have signed a global alliance agreement between Mahindra’s automotive component businesses held under its Systech Sector and CIE Automotive involving also its subsidiary Autometal.
The agreement will see the formation of a global automotive component supply network with combined annual sales of approximately Rs. 15,000 crores ($3 billion) with operations in North America, South America, Europe and Asia held through listed businesses in Spain, Brazil and India.
As part of the transaction, CIE Automotive, through one of its subsidiaries, will acquire from the Mahindra Group a stake in its listed and unlisted companies belonging to Systech Automotive Component business. CIE Automotive will contribute its forging businesses in Spain and Lithuania and together consolidate all companies under MFL which will be rechristened Mahindra CIE and will continue to be listed on the Bombay Stock Exchange and the National Stock Exchange.
The share sale by Mahindra will trigger open-offer provisions under the Securities Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations 2011.
The proposed business transaction will be carried out in a series of steps over the next year that will culminate in:
1. M&M taking a stake of 13.5 per cent in CIE Automotive, which is listed in Spain, making it the second largest shareholder in CIE. M&M will nominate two Directors to the CIE Board.
2. CIE Automotive taking a majority stake in a single listed entity in India which will continue to operate the current Systech automotive component businesses globally and include CIE’s European forgings operations.
“Eight years ago, we at Mahindra set out to build an Indian automotive supplier with a global footprint, and this drove a series of acquisitions in India and Europe for us. We have been listening closely to our customers who have asked to step up our globalisation efforts and follow them around the world. This grand alliance with CIE enables us to “rise” above competition, quickly extend our reach into new geographies and grow our collective product portfolio in the coming years,” said Mr. Anand Mahindra, Chairman of the Mahindra Group.
Mr. Anton Pradera, Chairman of CIE Automotive, said: “CIE’s leadership and shareholders have a strategy to develop India as the gateway to the Asian market. We have been impressed by the promise of the Indian automotive market and the growing emergence of India as a key global production hub for small cars. In Mahindra we found a partner that has a multi-technology portfolio similar to ours and shares the same business values. So while we are happy to see CIE gaining an entry to India, we are equally pleased to have M&M as one of CIE’s largest shareholders.”
Mr. Jesus Maria Herrera, CEO of CIE Automotive and Chairman of Autometal, noted that “CIE’s focus on growth with operational excellence is a value shared with the Mahindra Group, and as we join hands to become a bigger and better supplier, we see a bright future ahead of us.”
Mr. Hemant Luthra, President of Mahindra’s Systech Sector, commented: “Systech businesses are the result of acquisitions and alliances that we have struck around the world as we sought to quickly expand in the components business with our unique “Art to Part” proposition. This alliance with CIE dwarfs everything we have done in the past and marks the next bold step towards global supplier consolidation.”
Mahindra Satyam bags new contract from Bridgestone
Mahindra Satyam, a leading global consulting and IT services provider, has won a new multi-year contract from Bridgestone Europe for its managed services. The company will work on SAP-based mission critical applications for Bridgestone Europe.
As part of this deal Mahindra Satyam will support Bridgestone in sales, planning procurement and finance functions. It has been working with Bridgestone since 2005 in providing IT application development and support services.
“Bridgestone’s selection truly endorses the fact that our footprint in Europe continues to be strong as a market leader. We are thankful to Bridgestone for having recognized the skills, commitment and delivery excellence of Mahindra Satyam as we continue our journey”, said Mr. Sharat Kumar, Head – Delivery, Europe, and Sr. Vice President, Mahindra Satyam.
Mr. Joe O’Neill, IT Director, Bridgestone Europe, said: “Bridgestone is delighted to be able to extend its multi-year contract with Mahindra Satyam. We look forward to continuing to receive the high level of professionalism and commitment in services from Mahindra Satyam and its associates that we have experienced over the past 8 years.”
Bridgestone Corporation, headquartered in Tokyo, is the world’s largest tire and rubber company. In addition to tires for use in a wide variety of applications, it also manufactures a broad range of diversified products, which include industrial rubber as well as chemical and sporting goods. Its products are sold in over 150 nations and territories around the world.