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Old 3rd September 2019, 10:40   #1
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Default Mahindra to acquire 55% stake in Meru Cabs

According to a media report, Mahindra is set to acquire a 55% stake in ride-hailing firm Meru Cabs. The company plans to invest Rs. 103.5 crore by a fresh issue of shares in tranches.

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It has been reported that subsidiaries like Meru Mobility Tech Private Limited, V-Link Automotive Services Private Limited and V-Link Fleet Solutions Private Limited will now be a part of the Mahindra Group.

As per the agreement, the first tranche of investment is likely to be made by October 2019. Mahindra could also acquire shares from True North - an existing shareholder in Meru, for an amount not exceeding Rs. 98 crore.

Meru Cabs began operations in 2006. It is one of the first ride-hailing services in India and operates in Mumbai, Delhi and Bangalore. The company also provides transport solutions to call centres, banks, airlines among others.

Source: NDTV

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Old 3rd September 2019, 10:58   #2
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Default Re: Mahindra to acquire 55% stake in Meru Cabs

What could be Mahindra's game plan?
Well most of the Meru cabs are Mahindra Verito - so are they looking at assured business?
Or they want to expand to delivering services B2B; B2C is going to be dominated by app based firms.
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Old 3rd September 2019, 12:21   #3
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Default Re: Mahindra to acquire 55% stake in Meru Cabs

What I think is...
- Make the car, sell the car
- Bring app based commute & increase market share
- Arrange for bank loan, insurance to prospective cab drivers/owners
- Special discounts for Mahindra cars, bring down inventory
- If they can lease out Mahindra vehicles (like Hyundai), another edge

Nice plan to survive the market spiraling towards depression
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Old 3rd September 2019, 12:40   #4
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Default Re: Mahindra to acquire 55% stake in Meru Cabs

Or, is it to create a captive market for their electric vehicles.
If they can come up with a good battery swap technology, they can use electric cars for intra-city taxi services efficiently.
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Old 3rd September 2019, 16:54   #5
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Default Re: Mahindra to acquire 55% stake in Meru Cabs

Mahindra could be doing it for these reasons:
  • It could be planning to get into ride hailing market. The discounts are almost gone and you have surge prices as well for competitors. At this stage it is well off not spending the money on financing the discounts.
  • Look at increasing Verito/ other electric cars share in the taxi market.
  • Piloting the electric cars at a large scale for the general public to gain confidence. This can also give them volumes and economy for the private passenger vehicle market.

Last edited by aah78 : 3rd September 2019 at 17:06. Reason: LIST added.
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Old 4th September 2019, 14:40   #6
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Default Re: Mahindra to acquire 55% stake in Meru Cabs

Unless they got it for dirt cheap, I really can't think of a single reason why Mahindra should be interested in yesterday's star. Meru is such a has-been.

Anyone else feel Mahindra is spreading itself too thin? They got into EVs with Reva, but have done a shoddy job with it. Ditto with their foray into trucks, then 2-wheelers. IMHO, Mahindra should trim its to-do list, and then excel at what's left on it.
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