Samvardhana Motherson To Pump $15 Million In Israel's REE Automotive For 11% Stake
The acquisition will be made through MSSL Consolidated Inc., which is a wholly-owned subsidiary of Samvardhana Motherson.
Samvardhana Motherson International Ltd. will invest $15 million in REE Automotive Ltd., headquartered in Israel, to acquire a stake of 11% in the company, the auto components major said in an exchange filing on Sunday.
The acquisition will be made through MSSL Consolidated Inc., which is a wholly-owned subsidiary of Samvardhana Motherson.
As part of the transaction, MSSL Consolidated will subscribe up to 36,39,010 Class A ordinary shares of REE Automotive at a price of $4.12 apiece, the filing added.
While REE is headquartered in Israel, its has manufacturing facilities in the UK's Coventry and the US' Austin. Its turnover in calendar year 2023 stood at $1.6 million.
REE is primarily engaged in the "design, development and integration of various vehicle components into a module and complete modular platform specifically for commercial electric vehicles", the filing said.
REE has developed an innovative technology called "REEcorner" based on a portfolio of 175 patents registered and pending globally, which integrates essential vehicle systems such as steering, brakes, suspension, and powertrain control into a single, compact module, it added.
Samvardhana Motherson, as part of its acquisition of stake in REE, will be entering into a supply chain management agreement with the company to "accelerate its industrialisation in a mutually beneficial commercial construct".
Besides, the two companies will "leverage manufacturing capabilities for components and integration for REEcorner module, and platform assembly to support full vehicle assembly, including assembly of P7 electric trucks in the US", the filing added.
The acquisition, which will be completed in the form of an all-cash transaction, does not require governmental or regulatory approvals, Samvardhana Motherson said. The transaction is expected to be closed within 30 days, it noted.
Shares of Samvardhana Motherson advanced up to 1.6% to Rs 193.6 on the NSE during the trading session so far on Monday. In comparison, the benchmark Nifty 50 gained as much as 0.16%.
(With inputs from PTI).
