CORRECT: Mitsubishi to raise stake in Indian auto parts dealer
――Corrects 7th paragraph to say TVS Automobile Solutions is a unit of TVS Group which also includes TVS Motor Co. It is not a unit of TVS Motor Co. as reported in June 5 story.
NEW DELHI, NNA - Major Japanese trading house Mitsubishi Corp. will raise its holding stake in an Indian auto parts dealer to beef up its aftermarket sales business.
The company said Monday it will buy 9 percent of TVS Automobile Solutions Pvt. Ltd. from existing shareholders, and 13 percent via a private share placement, taking its stake from 3 percent to 25 percent.
Mitsubishi spokesman Sotaro Harasawa told NNA the transaction is expected to complete sometime between July and August but declined to comment on the value of the deal.
The trading house will get a second seat on the 10-strong board at the Indian firm, he added.
The move is “the first for Mitsubishi to fully tap into the aftermarket and mainly aims to establish a new business with the Indian partner,” Harasawa said, without elaborating.
Automotive aftermarket refers to spare parts, accessories and components.
TVS Automobile Solutions is a unit of TVS Group which also includes TVS Motor Co., the third-biggest motorcycle maker in India after Hero MotoCorp Ltd. and Japan’s Honda Motor Co.
The Indian firm, which also provides a vehicle maintenance service, sources car components from local and European parts makers. It has franchised 15,000 dealerships nationwide to reach 1.5 million customers, according to Mitsubishi’s statement.
With the partnership strengthened, Mitsubishi plans to get Japanese auto parts makers involved with TVS Automobile Solutions for procurement in the world’s fourth-largest auto market, as the Indian partner has few Japanese clients now, Harasawa said.
The two firms intend to expand franchise networks in Africa with the help of Mitsubishi’s local offices in 11 countries on the continent, including Algeria, Kenya and South Africa. (NNA/Kyodo)