Automaker Mahindra & Mahindra Ltd said on Friday a step-down unit will acquire automotive portal CarandBike.com from media house NDTV Ltd and other shareholders to expand its digital presence.
The step-down unit, Mahindra First Choice Wheels Ltd, will purchase 100% of CarandBike.com for up to Rs 30.45 crore (about $4.3 million), the automaker said in a stock-exchange filing.
NDTV said in a separate filing that the company and its subsidiary NDTV Convergence Ltd are selling their combined stake of 45.56% in the auto portal, operated by Fifth Gear Ventures Ltd, to Mahindra First Choice.
The details about the other shareholders could not be ascertained.
Mahindra said the acquisition is in line with its objective of expanding its presence in the digital automotive segment and integrating its online and offline user experience.
The company will pay Rs 16.44 crore in cash, with the remaining Rs 14.01 crore being discharged through the issue of equity shares amounting to around 0.75% of its fully diluted share capital.
Fifth Gear was incorporated in September 2015. Its platform, CarandBike, keeps users updated with information and reviews from the automotive industry, and also acts as an e-commerce portal for facilitating the sale and purchase of new and used vehicles.
Mahindra said it expects the acquisition to be completed by the end of March this year.
The company is a used vehicle firm that leverages its online and physical infrastructure to facilitate the sale and purchase of used vehicles. Its other products include a financing service, and ‘Konnect First’, a connected car device, according to its website.
In February 2018, Mahindra secured $15 million (Rs 95.8 crore) from its existing investors, with the transaction valuing it at around $265 million. Some of the investors in the company include the United States-based digital marketing company Cox Automotive, private equity firm Phi Advisors and US-based hedge fund Valiant Capital.