Mahindra & Mahindra To Acquire 26% of Gelos for ₹40.08 Crore

On April 15, 2024, Mahindra & Mahindra Limited informed in an exchange filing that the company approved the acquisition of a 26% stake in one or more tranches in the Paid-Up Equity Share Capital of Gelos Solren Private Limited (Gelos).

Details of the Acquisition

Mahindra & Mahindra stated that Gelos is a wholly-owned subsidiary of Mahindra Susten Private Limited, which is a subsidiary of Mahindra Holdings Limited, which in turn is a wholly-owned subsidiary of the company. The acquisition of 26% equity shareholding of Gelos would be a Related Party Transaction and would be done at arm’s length. Upon completion of the aforesaid transaction, Gelos will continue to be a subsidiary of the company.

Regarding the acquisition’s object, Mahindra & Mahindra said that the investment will help them reduce their energy costs and carbon footprint. They are working towards their commitment to ‘Planet Positive’ businesses and adopting 100% renewable energy by 2030 across various businesses.

As per the exchange filing, the acquisition is expected to be completed by August 31, 2025. The consideration for the acquisition will be in cash. The total cost of acquisition is ₹40.08 crore, to be paid in one or more tranches. Post-acquisition, Mahindra & Mahindra would hold 26% of Gelos’ paid-up equity share capital.

Gelos was formed to produce and sell Power, Generate Electricity, and provide Distributed Energy, including rooftop solar, for the commercial, industrial, institutional, and residential segments.

In the same filing, Mahindra & Mahindra also stated that the company’s subsidiary, Mahindra Susten, entered into the ‘Hybrid’ Renewable Energy (RE) segment with a ‘solar + wind’ project. The Group plans to invest ₹1,200 crore to set up 150MW hybrid capacity. The installation will include ~101 MW wind capacity and ~52 MW solar capacity and is expected to generate ~460 million kWh of energy, leading to an expected abatement of about 4,20,000 tonnes of CO2 emissions.

About Mahindra & Mahindra Ltd

Mahindra & Mahindra Ltd is the most diversified automobile company in India. The company also has a presence across auto components, financial services, hospitality, retail, infrastructure, steel trading and processing, logistics, IT businesses, energy and more through its subsidiaries and group companies.

On April 15, 2024, the share price of Mahindra & Mahindra opened at ₹2,055.25, touching the day’s high at ₹2,073.35, as of 2:25 PM on the NSE.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.