M&M’s Canada-based associate firm, Resson Aerospace Corp, shuts down

Mumbai-based Mahindra & Mahindra on Thursday said its Canada-based associate firm Resson Aerospace Corporation has closed down. The automaker held an 11.18 per cent stake in the firm. The firm had filed for a voluntary winding-up notice, M&M said in a regulatory filing.

“Resson has received a Certificate of Dissolution from Corporations Canada dated 20th September 2023, which was informed to the Company on 20th September 2023 at 8.19 p.m. Consequent to the above, Resson has ceased to be in existence and has also ceased to be an Associate of the Company under the Indian Accounting Standards (IndAS) with effect from 20th September, 2023," said M&M in its stock exchange filing on Thursday.

Consequent to this, Resson has ceased to be in existence and has also ceased to be an associate of the company with effect from September 20, 2023, it added.

"Upon liquidation of Resson, the company is entitled to receive approximately 4.7 million Canadian Dollars (equivalent to Rs 28.7 crore) as distribution of proceeds towards Class C Preferred Shares held by the company," M&M said.

Shares of M&M were trading at Rs 1,604.60, up by 1.31 per cent.

In 2018, M&M signed an agreement with Resson Aerospace firm to acquire up to 10 per cent share capital for up to 6.63 million Canadian dollars to be paid in cash.

Meanwhile, the market capitalisation of M&M crossed Rs 2 lakh crore mark on Monday this week on the back of a strong order book in the SUV segment and leadership position in tractor segment.
The automaker's market cap has doubled in less than one-and-a-half years - from Rs 1 lakh crore in April 2022 to over Rs 2 lakh crore this week.

The incremental m-cap in the last two years is more than the incremental market value the firm had over the last decade. Capital allocation actions have led to an overall better financial performance with several non-accretive divestments completed, analysts said adding net cash is at all-time high levels.

Mahindra's auto and farm businesses are industry leaders and it is looking to capitalise on market leadership position. It is No. 1 revenue market share in the SUV segment and has about 50 per cent market share of LCV.

(With agency inputs)

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