SML Mahindra to acquire Mahindra’s truck and bus business for Rs 525 crore

Mahindra & Mahindra (M&M) will transfer its Truck and Bus Division (MTBD) to its listed subsidiary SML Mahindra Limited for Rs 525 crore, consolidating the group's commercial vehicle operations under a single entity, the company said in a filing.

The board of directors of M&M approved the sale, transfer and disposal of the MTBD business undertaking on a slump sale basis to SML Mahindra under a Business Transfer Agreement (BTA). The agreement is expected to be executed on or before August 7, 2026, with the transaction likely to be completed by January 31, 2027, subject to regulatory approvals and fulfilment of other conditions.

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A slump sale refers to the transfer of an entire business undertaking as a going concern for a lump-sum consideration, rather than selling individual assets and liabilities separately.

The transfer will include MTBD's employees, assets, intellectual property, licences, permits, insurance policies, contracts, rights and liabilities. The consideration of Rs 525 crore is subject to working capital adjustments as specified in the BTA.

The restructuring comes after Mahindra acquired a controlling stake in SML Isuzu in August 2025 from Sumitomo Corporation and Isuzu Motors, following which the company was renamed SML Mahindra.

The MTBD business generated Rs 2,989 crore in revenue during FY26, accounting for around 2.02% of Mahindra & Mahindra’s total income from operations during the year. The company said the net worth of the division is not separately maintained or reported. Its investment in the business stood at around Rs 481 crore as of March 31, 2026, accounting for about 0.65% of M&M’s total net worth.

SML Mahindra will acquire the business to create a unified truck and bus platform within the Mahindra Group, covering light, intermediate and heavy commercial vehicles, as well as buses in the above 3.5-tonne segment.

Mahindra said the consolidation is expected to help the combined business benefit from greater scale, wider market coverage, a stronger product portfolio and improved operational efficiencies.

Dr Anish Shah, Group CEO and Managing Director, Mahindra Group, said, "The transaction simplifies Mahindra Group's commercial vehicle business structure by consolidating truck and bus operations under SML Mahindra, creating a single focused entity dedicated to growth and leadership in the commercial vehicle sector. This is an important step towards our aspiration of building a leading position in the Truck & Bus segment and creating long-term value for all stakeholders.”

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Rajesh Jejurikar, Executive Director and CEO, Auto and Farm Sector, Mahindra & Mahindra, said, “This partnership is about unlocking the best of both organisations. By combining strengths of SML and Mahindra Truck & Bus, we can drive meaningful synergies across operations, technology and customer-facing domains while preserving the unique heritage and market positioning of both brands. Together, the two brands will be better placed to expand customer reach, enhance offerings and create greater value for all stakeholders.”

Vinod Sahay, Executive Chairman of SML, said, "This acquisition is a transformative step in the evolution of SML Mahindra. By bringing together SML and Mahindra Truck & Business under one unified commercial vehicle platform, we are creating a stronger business with greater scale, broader market coverage and a more comprehensive product portfolio. The combination leverages the complementary strengths of both organizations and is expected to unlock significant commercial and operational synergies. We believe this transaction will enhance our competitiveness, improve operational effectiveness and create sustainable long-term value for our customers, employees, partners and shareholders."

Following the transfer, manufacturing of Mahindra-branded trucks and buses will continue to be carried out by M&M under a contract manufacturing arrangement, ensuring continuity of supply and operations.