When it comes to hired mobility solutions in India, there are majorly three key players in the market – Ola, Uber and Meru. The latter is lately having a tough time competing with the big guns but that might change soon as Mahindra and Mahindra has increased its equity shareholding in its subsidiary, the cab aggregator Meru Cabs, from 43.2% to 100%, the company announced in a filing with stock exchanges on April 30.
To buy out the stakes, Mahindra and Mahindra will spend around ₹98 crore. The Indian car manufacturer will acquire 44.14 per cent shares from private equity investor True North and others for an amount not exceeding ₹76.03 crore.
Besides this, it will also have to buy 12.66 per cent shares from Neeraj Gupta and Farhat Gupta, the husband-wife duo who founded the cab service, for an amount not exceeding ₹21.63 crore. Pravin Shah will be the new CEO of Meru and its subsidiary companies from today, while Neeraj Gupta, founder CEO of Meru and its subsidiary companies, have stepped down to continue as an ordinary employee now. Pravin Shah was earlier the president of Mahindra and Mahindra Automotive till March 2017.
Commenting on the acquisition, 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.”
Neeraj Gupta, Founder CEO and Whole Time Director- Meru said, “The last two decades in the mobility industry, building Meru to become a household name in the country has been exhilarating. The time is right for me to pursue newer interests and handover Meru in the safe hands of the Mahindra Group, one of the finest corporate houses in the country. Under the able leadership of Dr. Anish Shah, I am confident that Meru will rise to greater heights in the times to come.”
Meru operates the second largest fleet of EVs in the country with over 350 electric vehicles operational across Mumbai and Delhi.