Sajjan Jindal-led JSW Group to hold 35% stake in MG Motor India

China's SAIC Motor and the JSW Group have entered into a strategic joint venture where Sajjan Jindal-led JSW Group will hold 35% stake in MG Motor India.

MG Motor UK Limited (MG Motor) is an automotive company owned by SAIC Motor UK, headquartered in London, owned by the Shanghai-based Chinese state-owned automaker SAIC Motor. Chinese investments have faced increased scrutiny by the Indian government and SAIC Motor said in May that it planned to drop its ownership of MG Motor India to allow domestic entities to take a majority stake.

The agreement between JSW and SAIC was signed "with the objective of accelerating the growth and transformation of MG Motor in India", the companies said in a statement on Thursday

"The Shareholder Agreement and Share Purchase & Share Subscription agreement were signed by the President of SAIC Wang Xiaoqiu and JSW Group’s Parth Jindal at the MG Office in London with the objective of accelerating the transformation and growth of MG Motor in India. SAIC Motor and JSW Group will create strategic synergies by bringing together resources in the field of automobiles and new technology. The joint venture will also undertake multiple new initiatives including augmenting local sourcing, improving charging infrastructure, expansion of production capacity, and introducing a broader range of vehicles with a focus on green mobility," the companies said,

According to Wang Xiaoqiu, President of SAIC Motor: "The automobile business is a global industry, and like in any other similar industry, access and collaboration are crucial for its healthy growth. SAIC has always adhered to the 'win-win cooperation' approach while steadily improving our core capabilities and expanding our scale of production and sales. In the growing Indian automotive market, both partners shall work closely to bring in the best of innovation, in creating greener and smarter mobility products and services for our consumers, seizing market opportunities, continuously expanding the brand influence and market share of our products, and achieving greater success for MG in India."

"The rich history of the MG brand is known to all and its success in India is there for all to see and it is truly an honour to be able to take this brand and company forward alongside a strong global partner in SAIC. We cannot wait to get going.” 

The partnership will also develop other products and explore improving charging infrastructure and expanding local sourcing, they said.

"The joint venture will optimise SAIC Motor’s vast automotive experience and technical expertise to demonstrate MG’s spiritual cores. It will also leverage the large presence of JSW Group across B2B and B2C sectors of the Indian economy to augment local sourcing and establish a robust supply chain.

"Together, SAIC and JSW Group will work towards creating a smart and sustainable automotive ecosystem in India by bolstering the development of NEVs and ICEs with Carbon Neutrality, Sustainability and Green Mobility at the centre of its shared vision. Both JV partners are committed to continue staying invested in the Indian market with a visiontowards achieving sustainable growth," said JSW Group.

Last November, the government asked MG to explain why it made a loss in 2019-2020, its first year of operations.