Tractor-to-technology major Mahindra & Mahindra (M&M) today said it has bought the remaining 56.8 percent share in Meru Cabs to take its holding to 100 percent. The company said this decision is part of its strategic intent to grow its presence in the shared mobility space.
The company bought 44.14 percent of the paid up capital of Meru Cabs for Rs 76.03 crore from private equity investor True North and others and 12.66 percent shares from Neeraj Gupta and Farhat Gupta, for Rs 21.63 crore.
It said, "The said share purchase agreement also envisages that 30,000 Optionally Redeemable Optionally Convertible Non-Cumulative Preference Shares (“OCRPS”) held by an existing shareholder, be redeemed at the face value of Rs 10 each, at an aggregate price of Rs 3,00,000 out of the proceeds of a fresh issue on Rights basis."
M&M further said, "An Agreement with Neeraj Gupta & Farhat Gupta to acquire shares held by them in Meru aggregating 12.66 percent of its paid up Equity share capital, for an amount not exceeding Rs 21.63 crore which will be followed with the execution of a Share Purchase Agreement."
The acquisition of shares of Meru from shareholders and subscription by the Company in the Rights Issue of Meru for the purpose of redemption of OCRPS will result in the present equity shareholding of the Company in Meru being enhanced from 43.20 percent to up to 100 percent, it said.
Ridesharing company Meru Cabs was founded in 2006. It has a significant presence in the airport transfer business, operating in the ride hail segment and providing employee transportation services to corporates in India.Anish Shah, MD and CEO, Mahindra Group said, “At the outset, I would like to thank Neeraj Gupta and the team at Meru for building a pioneering brand in the shared mobility space in India. Our association with Meru is built on our compelling strategy to scale our shared mobility businesses. Pravin has agreed to take this critical responsibility of the business and to develop sustainable and scalable business strategies.”