The Competition Commission has approved Mahindra and Mahindra’s acquisition of majority stake in a wholly-owned subsidiary of Ford Motor Co, which will create a joint venture in the country.
The new venture would acquire the automotive business of Ford India Pvt Ltd (FIPL), a wholly-owned subsidiary of Ford Motor Co. The automotive business includes vehicle manufacturing plants of Ford India in Chennai and Sanand.
At the time of announcing the alliance in October last year, the terms of the deal specified that Ford would transfer its local automotive assets, including both its car manufacturing plants in the country, and employees to the new entity. Ford has been globally restructuring its businesses with an aim to save $11 billion over the next few years.
By shifting to a JV, Ford is changing its India strategy where it has long run an independent operation in a market dominated by Asian car makers like Suzuki Motor Corp and where others have struggled to make money.
“Strong alliances like this play a crucial role in assuring we continue to achieve our vision while at the same time staying competitive and delivering value to our global stakeholders,” Jim Hackett, President-CEO, Ford, had said in the statement.