Mu0026M will acquire 55 pcs in Meru game for a cash consideration of up to Rs 201.5 cr
New Delhi, September 1 () The main Mahindra u0026 Mahindra home-grown utility vehicles are acquiring a 55 percent stake in the Meru Travel Solutions taxi passenger and radio operator service for a cash consideration of up to Rs 201.5 Rs million, according to a company regulatory document.
The company signed a share subscription and shareholder agreement on Saturday to sign up to 55 percent of Meru Travel Solutions Pvt Ltd's share capital in installments, Mahindra said Mahindra in a BSE presentation.
Under the agreement, after the investment of the first tranche in Meru, Mu0026M will have the right to appoint the majority of the directors in the Meru board of directors and will control its composition, he added.
Upon obtaining that right, Meru will become a subsidiary of the company, Mu0026M said, adding subsidiaries of Meru - Meru Mobility Tech Pvt Ltd, V-Link Automotive Services Pvt Ltd and V-Link Fleet Solutions Pvt Ltd - in turn also become subsidiaries of Mu0026M.
According to the presentation, the acquisition will be made through a cash consideration and Mu0026M will invest an amount not exceeding Rs 201.5 million rupees in Meru.
According to the structure of the agreement, Mu0026M will make a primary investment of an amount that will not exceed Rs 103.5 million rupees for a participation of up to 55 percent in Meru tranches.
The agreement also provides that Mu0026M has the right of purchase option to acquire shares of certain existing Meru investors and these existing Meru investors would have put the option of selling shares for an amount not exceeding Rs 98 Rs, he added.
Meru, which was incorporated in December 2006, recorded consolidated income of Rs 156.6 million in 2018-19, Rs 189.9 million in 2017-18 and Rs 277.2 million in 2016-17. As car companies adapt to changing times, they have been making investments in new providers of technology-driven mobility solutions. Earlier this year, Hyundai and Kia from South Korea had announced together that they were investing USD 300 million (about 2.1 billion rupees) on India's trip to call the great Wave. RKL RVK