Mahindra & Mahindra’s move to acquire majority stake in Reva Electric Car Company has created wide ripples in the Indian auto mart. Post acquisition, Chetan Maini, Mahindra Reva?s chief of technology and strategy, discusses with FE’s Jaishankar Jayaramiah the motives behind the move, future plans and his family’s role in the new company : Excerpts :
What made Reva to sell a majority stake to M&M?
The electric vehicle market in India is poised to grow significantly and we have concluded that in order to seize the opportunity, we need resources and experience of a major automotive manufacturer like Mahindra & Mahindra (M&M). In M&M, we have found a company that not only shares our vision of principled and sustainable growth but also has a reputation for good corporate governance.
What kind of changes can one see in Reva, now that M&M has made this investment?
As a result of Mahindra’s investment, Mahindra Reva will be able to scale, innovate, accelerate and deliver better products to more customers in more places.
Reva already has a pact with General Motors to make electric cars for the Indian market. You also sell your cars in GM?s outlets. Now with M&M acquiring controlling stake in Reva, what is the status of the pact with GM?
It was not clear if GM will continue with the agreement. It is for them to decide. After knowing our agreement with M&M, GM has informed us that they would look for other options. We are open to what GM decides.
What are the major benefits the company will get due to association with M&M?
M&M has a strong distribution network in the domestic and international markets. Reva is a technology innovator with the largest deployed fleet of electric cars in the global market today.
In 2006, Reva raised $20 m from global PE players. Post the buyout by M&M, what is the status of your PE partners?
There are no more PE investments in Reva. We already bought the stakes of GEF and DFJ some months ago. As of now, M&M, the Maini family and California-based AEV LLC are only the stake holders in the company.