The Hindu Business Line : Mahindra eyes overseas, domestic acquisitions

UTILITY and commercial vehicle-maker Mahindra & Mahindra today said it was in the process of acquiring companies in India and overseas to expand its auto components business.

"Three acquisitions are under way," the M&M Vice-Chairman and Managing Director, Mr Anand Mahindra, said at the Tenth Asia Pacific Automotive Industry Roundtable here today. He also cited ongoing talks with an overseas forgings company.

Though further details were not disclosed, company officials said M&M hoped to sew up at least three deals within the current financial year. It was talking to more companies than cited in public.

Justifying the overseas acquisitions, Mr Mahindra said it not only gave the company a "front-end" in those markets but also helped gain technology and marketing channels.

Aiming for top slot in tractors: Notwithstanding the aggressive growth plans in the components business, one of its four business verticals in automobiles (including tractors), the company's target was the top slot in tractor manufacturing worldwide and a global brand in sports utility vehicles (SUVs). He pointed out that the newly created joint ventures for trucks and passenger cars were comparatively more specific in their intent.

Tie-up with Renault: On M&M's tie-up with French auto major Renault to manufacture the mid-size sedan `Logan' in India, Mr Mahindra reiterated that it was a "platform-driven joint venture". Its specific goal was to roll out the Logan in India, in the course of which it would fulfil some strategic objectives of both companies.

M&M, for instance, would benefit from access to Renault's global sourcing programme and interaction on the engineering front. "The JV is for a fixed period of time, with an option. If we speak French better and they speak Hindi better, then we continue," he said.

Asked why the company had moved into three-wheelers, Mr Mahindra said they appeared the best vehicles around to experiment with new engine technologies such as hybrid and electric engines. "They would serve as platform for alternative technologies. We have developed an electric three-wheeler, which is already running in Haridwar," he said.

Selling to the US

A MUCH-REPEATED question on both days of the Automotive Industry Roundtable was whether cars would be made in India for shipment to the US market. The logic for the query rested in the rising number of reports citing trouble at American component manufacturers, with many putting their plants for sale.

Mr Anand Mahindrasaid many offers were headed towards Indian shores. Half in jest, he noted that Detroit hotels appeared full of Indian entrepreneurs scouting for opportunities and there were plenty of merchant bankers too ready to back them.

On a more serious note, he said M&M had some time ago received a query from a leading US car distributor for the manufacture of a high value car. "He is still knocking at our door," Mr Mahindra said.

The story continued into trucks as well. Citing his experience while firming up M&M's recent JV with International, he said the search was on for "basic, good value products". "People are fed up of trucks that look like space ships," he said.

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