Mahindra and Mahindra, Ford Motor JV approved by Competition Commission

In October last year, M and M said it would buy 51 per cent stake in Ardour Automotive Pvt Ltd for around Rs 657 crore. In a tweet on Monday, the Competition Commission of India (CCI) said it has approved “formation of JV between Mahindra & Mahindra and Ford Motor and transfer of automotive business of Ford India to the JV.” The remaining stake of 49 per cent in Ardour Automotive would be held by Ford Motor Co and/ or any of its affiliates.

The new venture would acquire the automotive business of Ford India Pvt Ltd (FIPL), a wholly-owned subsidiary of Ford Motor Co. The automotive business includes vehicle manufacturing plants of Ford India in Chennai and Sanand.

At the time of announcing the alliance in October last year, the terms of the deal specified that Ford would transfer its local automotive assets, including both its car manufacturing plants in the country, and employees to the new entity. Ford has been globally restructuring its businesses with an aim to save $11 billion over the next few years.

By shifting to a JV, Ford is changing its India strategy where it has long run an independent operation in a market dominated by Asian car makers like Suzuki Motor Corp and where others have struggled to make money.

“Strong alliances like this play a crucial role in assuring we continue to achieve our vision while at the same time staying competitive and delivering value to our global stakeholders,” Jim Hackett, President-CEO, Ford, had said in the statement.