According to recent reports, MG Motor, the Chinese automotive behemoth, is purportedly seeking to sell its controlling stake in its Indian automobile enterprise. A number of players, including Reliance, owned by Asia’s wealthiest individual Mukesh Ambani, are vying to acquire the automobile behemoth.
As per the report, the company is currently engaged in “advanced negotiations” with several potential buyers, namely Reliance Industries, Hero Group, Premji Invest, and JSW Group.
According to a source, MG Motor is currently engaged in intense discussions with Indian companies and is aiming to finalize a deal by the end of this year.
According to sources, talks are reportedly in an advanced stage as MG is seeking funds to commence the next phase of expansion. The company is said to be in urgent need of funds and is looking to secure them almost immediately. MG management is currently engaged in negotiations with the aim of securing a credible partner, all while ensuring that the valuations remain attractive.
The Chinese automotive behemoth, SAIC, has dismissed reports of its alleged discussions with Reliance, Hero Group, Premji Invest, and JSW as “speculative.”
In recent times, Reliance, under the leadership of Ambani, has ventured into various new business domains with the aim of making its operations more focused on the needs of consumers. According to reports, the company has set its sights on the insurance and asset management company sectors, following its entry into the FMCG and commercial real estate industries.
Since the Galwan clash between the armies of China and India in June 2020, Chinese companies operating in India and investments from China have been subjected to close scrutiny. This development is significant. In a move to strengthen regulations for Chinese companies, the Indian government has revised its Foreign Direct Investment (FDI) policy to prevent “opportunistic takeovers” of Indian companies by Chinese entities. This policy change was implemented in the same year.
The Indian government has recently made changes to its investment policies, requiring approval for investments from neighboring countries that were previously allowed through the automatic route.
In a move that further intensifies the crackdown on Chinese companies in India, the central government has issued a ban on numerous gaming and loan applications that were operating within the country.
