Mumbai, India – April 27, 2025 – Mahindra & Mahindra Ltd. (M&M), a leading Indian automaker renowned for its SUVs and tractors, has announced a strategic acquisition of a 58.96% stake in SML Isuzu Ltd. for ₹555 crore (approximately $65 million). This move is set to strengthen M&M’s position in India’s fast-growing commercial vehicle (CV) market, particularly in the >3.5-tonne segment. The deal, revealed on April 26, 2025, includes purchasing shares from Japan-based Sumitomo Corporation and Isuzu Motors Ltd., alongside a mandatory open offer for public shareholders.
Details of the Mahindra-SML Isuzu Acquisition
M&M will acquire 43.96% of SML Isuzu’s shares from Sumitomo Corporation, the company’s promoter, and an additional 15% from Isuzu Motors, a public shareholder, at ₹650 per share. As required by the Securities and Exchange Board of India (SEBI) Takeover Regulations, M&M will also launch an open offer to purchase up to 26% of the company’s public shares at ₹1,554.60 per share. The acquisition is subject to regulatory approvals, including clearance from the Competition Commission of India (CCI), and is expected to be finalized by December 2025.
The deal is a significant step for M&M, which currently holds a 3% market share in the >3.5-tonne CV segment compared to a dominant 52% in the <3.5-tonne light commercial vehicle (LCV) market. According to M&M, this acquisition will double its market share to 6% in the trucks and buses segment, with ambitious plans to reach 10–12% by FY31 and over 20% by FY36.
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Strategic Importance of the Acquisition
SML Isuzu, established in 1983, is a key player in India’s commercial vehicle market, with a 16% market share in the intermediate light commercial vehicle (ILCV) bus segment. The company reported an operating revenue of ₹2,196 crore and an EBITDA of ₹179 crore in FY24, showcasing its profitable operations and strong engineering capabilities. SML Isuzu’s portfolio includes trucks, buses, and special application vehicles, with manufacturing facilities in Punjab and exports to countries like Bangladesh, Nepal, and Bhutan.
Dr. Anish Shah, Group CEO and Managing Director of Mahindra Group, emphasized the acquisition’s alignment with the company’s growth strategy. “The acquisition of SML Isuzu marks a significant milestone in Mahindra Group’s vision of delivering 5x growth in our emerging businesses,” Shah said. “It fits perfectly with our capital allocation strategy, focusing on high-potential areas with strong performance and clear opportunities to win.”
Rajesh Jejurikar, Executive Director and CEO of M&M’s Auto and Farm Sector, added, “SML brings a strong legacy, a loyal customer base, and a credible product portfolio that complements Mahindra’s existing offerings in the trucks and buses segment. This acquisition is a pivotal step toward becoming a full-range, formidable player in commercial vehicles.”
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Market Impact and Industry Context
The acquisition comes amid growing demand for commercial vehicles in India, driven by macroeconomic growth, infrastructure development, and government initiatives like the Bharatmala project and Smart Cities Mission. SML Isuzu is well-positioned to capitalize on this demand, particularly in specialized vehicles such as refrigeration vans and school buses.
The deal has already stirred market interest, with SML Isuzu’s stock surging 60–62% in March 2025 due to speculation about a potential acquisition by M&M or competitors like Ashok Leyland. The acquisition price of ₹650 per share represents a steep discount compared to SML Isuzu’s closing price of ₹1,773.4 on April 25, 2025, which may influence investor sentiment during the open offer period.
What’s Next for Mahindra and SML Isuzu?
Upon completion, SML Isuzu will become a listed subsidiary of Mahindra & Mahindra, with M&M gaining control and planning board changes. The acquisition is expected to unlock operational synergies in manufacturing, supply chains, and product development, enhancing M&M’s competitive edge in the CV market. Kotak Investment Banking is serving as the financial advisor and manager for the open offer, while Khaitan & Co. is providing legal counsel.
This acquisition marks M&M’s second major move in the commercial vehicle sector and the first significant deal under Anish Shah’s leadership since he became Group CEO in 2021. As India’s automotive industry evolves, M&M’s strategic investment in SML Isuzu positions it to capture a larger share of the booming CV market.
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