Remember we told you about two weeks ago about Mahindra contemplating buying PSA Peugeot Citroen's scooter business? Turns out the speculations weren't far fetched after all. Mahindra & Mahindra (M&M) Ltd. today announced its conclusive deal to acquire a 51 per cent stake in PSA Peugeot Citroen's scooters business.
The deal will involve the country's largest utility vehicle maker injecting 15 million euros into Peugeot Motorcycles to finance projects. That's all we know for now about the deal since Mahindra is yet to reveal more details about it.
The deal will come as a respite for PSA Peugeot Citroen, since Peugeot Motorcycles has only posted losses in the last decade. As far as M&M is concerned, the company has also been in the business of making scooters since 2008, though the competition it faces from Hero MotoCorp Ltd. and Honda Motor Co. is quite obvious.
Considering the fact that scooter sales in the country grew by 23 per cent last financial year, M&M's wish to find access to technology befitting this increasingly competitive market makes sense. Also, this deal will also help the company gain global footprint.
