17 Oct M&M – favourite for Aston Martin acquisition
Aston Martin which has been James Bond’s companion for years has been put on sale in Bond’s golden jublee year. Though it was the Italian PE investor company which got their hands onto it while Mahindra and Mahindra were a close competitor. Without any doubts this iconic British brand could have been the icing on the cake in M&M’s brand-building process.
Eventhough the nitty gritty’s aren’t known, observers said that it hardly made a comfortable fit as M&M is a hardcore utility vehicle maker which had recently snapped up SsangYong Motor of South Korea.whereas Aston Martin is a top luxury brand.
However , M&M as we all know is a well established brand in India right from SUVs, cars and trucks to IT and real-estate and adding an Aston Martin in its portfolio could have been a critical lever in making it a bigger global player.
Eventhough Aston Martin’s annual sales are barely 5,000 units and despite of it being bogged down with its share of debt,being an owner of this prestigious brand would have definitely given M&M a push. Acquiring top global names is now par for the course, whichexplains why China’s Geely took over Volvo Cars and Tata Motors acquired Jaguar Land Rover.
M&M has lost such an opportunity before also when it was in race for JLR, five years ago.However the reasons for JLR’s acquisition were quite different. JLR’s annual numbers are at least 50 times as much. Two, Land Rover, which accounts for a lion’s share of these volumes, would have represented the premium end in M&M’s SUV business.
M&M desires a bigger foothold in the international market but claims that SUVs will continue to be the core bread-and-butter activity and the most critical growth engine.What has already worked in favour of M&M is that being an Indiancompany,they managed to be on the top favourite to acquire this British iconic brand which no one had ever thought of.
Opportunities are rising and the Indian players are making the most of it.These players have worked hard enough to reach such a stage wherein we can see that a French carmaker’s (Peugeot) shares promptly fell when the Tatas denied the news of becoming a potential ally for them.
In such a situation, is it PE or M&M which would fit Aston Martin well?