Mahindra & Mahindra (M&M) is set to acquire a 55 percent equity stake in radio taxi service provider Meru Cabs for a total value of Rs 201.5 crore. This comes after the company filed its intent for the same with the BSE.
Mahindra & Mahindra says it "is keen to grow its presence in the shared mobility space and by acquisition of stake in Meru, the company will enter in the corporate shared mobility space which is an area of strategic interest to the company."
As per the company statement, "After investment of the first tranche in Meru, the company will have the right to appoint majority of the directors on the board of Meru and as such will control the composition of the board of directors of Meru. Upon obtaining such right, Meru will become a subsidiary of the company, and the following subsidiary companies of Meru, will in turn, also become subsidiaries of the company: 1. Meru Mobility Tech Private Limited 2. V-Link Automotive Services Private Limited 3. V-Link Fleet Solutions Private Limited."
Meru, one of the first radio taxi operators in the ride-hailing segment, provides metered radio taxi services in the cities of Mumbai, Delhi, Bengaluru and Hyderabad since April 2007. V-Link Automotive Services, a Meru subsidiary, provides radio taxi services and tourist cab services in various cities of India. It operates a large fleet across India, supported by a 24x7 call centre and advanced GPS, GPRS-based cab dispatching services, quick cab bookings, through its website and mobile application.
M&M bets big on shared mobility
If one joins the dots together, it looks like Mahindra & Mahindra is fast upping its shared mobility quotient. In February 2018, M&M has announced its plan to invest in Zoomcar India and in Zoomcar Inc, its US incorporated holding parent company, in line with the automaker’s thrust on the shared mobility business. Under the deal, the Mahindra Group would invest up to Rs 176 crore in Zoomcar India or Zoomcar Inc, which would constitute an approximately 16 percent stake in Zoomcar Inc.
At the time, in a tweet, Anand Mahindra, chairman of the Mahindra Group, said: "Our journey in the shared mobility space is just beginning . . ."
It helps M&M that Zoomcar is bullish on electric mobility in India. Currently, about 5 percent of its fleet is electric vehicles (EVs), and it is expected to remain between 5-10 percent for the next two years.
February 2018 also saw M&M merge its Mahindra SmartShift business with Resfeber Labs' Porter, for increasing its share in the USD 130 billion Indian logistics industry. SmartShift, a technology-enabled load exchange platform, which began its operations in October 2015, acts as an exchange platform for cargo owners and transporters, enabling them to work with each other. At an estimated investment of Rs 65 crore in the merged entity called Mahindra SmartShift, 'Porter' and `SmartShift' continue to serve their respective customers and partner-drivers to optimise greater operational efficiency. This merger was aimed at enabling both, SmartShift and Porter to spread out to a pan-India presence in the shared mobility space.
A year later, in February 2019, M&M launched Glyd, a premium technology-based e-mobility service in Mumbai. Glyd is billed as a premium, smart and sustainable solution for daily commuting for office-going executives and uses zero-emission electric vehicles. The company says Glyd will offer a premium in-commute experience to office-going executives, which is powered by several connected car features including web-conferencing, curated entertainment and music content from selective partners.
For the year ended March 31, 2019, the revenues were Meru: Rs 156.6 crore consolidated; Meru Mobility Tech: Rs 114.6 crore standalone; V-Link Automotive: Rs 3.3 crore standalone; and V-Link Fleet: Rs 46.6 crore standalone.