TVS ASPL will also be acquiring the whole stake aggregating to one hundred% of optionally convertible redeemable preference shares in Auto Digitech (ADPL), a wholly owned subsidiary of MFCSL.
In a consolidation in the automobile aftermarket organization, TVS Automobile Solutions (TVS ASPL), portion of the $8.5 billion TVS Group, is purchasing out Mahindra First Choice Services (MFCSL), a pan-India chain of multi-brand car or truck and two-wheeler service workshops, from the steady of the $19.4 billion Mahindra Group. TVS ASPL will also be acquiring the whole stake aggregating to one hundred% of optionally convertible redeemable preference shares in Auto Digitech (ADPL), a wholly owned subsidiary of MFCSL. While the MFCSL acquisition is for a money consideration of Rs 21.50 crore, the ADPL buyout is for `13.50 crore and funds in each the bargains will go to Mahindra Holdings, the holding corporation of each the entities. As portion of the transaction, Mahindra Holdings will obtain a minority stake of 2.76% in TVS ASPL. After the transaction, MFCS and ADPL will develop into the subsidiaries of TVS ASPL.
R Dinesh, director, TVS ASPL, mentioned, “Two great brands have come together for the benefit of the overall aftermarket ecosystem. India’s $10 billion aftermarket segment is fragmented and needs strong support for relevance and growth amidst changing technology landscape in the automotive sector. We would take this opportunity to bring thousands of entrepreneurs into a digital platform wherein they can benefit from digital technologies across marketing, diagnostics, customer experience, quality parts, access to training and digital payments.”
The TVS ASPL brand myTVS has designed a digital platform and ecosystem for more than 2,500 garages, in particular across south India. With MFCSL, the corporation will have an chance to produce a pan-India digital footprint. It plans to invest and expand the network to more than 10,000 garages in 18 to 24 months.
V S Parthasarathy, president, mobility solutions sector, Mahindra Group, mentioned, “MFCSL has developed a large, trusted, multi-brand car service franchise and distribution network over the years. Our focus on quality and customer satisfaction has ensured that we continue to deliver superior value to our customers and channel partners. I believe that consolidation, scale and phygital solutions will drive the next phase of growth for the company as well as the industry. I am confident that a strong partner like TVS ASPL will help take our legacy further and propel the company to the next orbit.”
The Indian independent automobile aftermarket has been expanding at a CAGR of 7-10% more than the previous 5 years. The marketplace is extremely fragmented with more than 40,000 retailers, one hundred,000 garages and thousands of smaller distributors across the nation. MFCSL has established a pan-India network of 475-plus franchise partners and more than one hundred distributors in more than 350 towns across 25 states and two union territories. TVS ASPL, more than the years, has empowered more than two million shoppers, 20,000 retailers and 10,000 garages, along with fleet management for more than 70,000 cars.
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