M&M has started reviewing operations of Mahindra North America (MANA), its US subsidiary said company's top official. The move comes close to its decision to sell stake in Korean subsidiary SsangYong Motor and winding up Genzee, its electric two-wheeler business in the US. The company is in the midst of a restructuring exercise that is aimed at improving shareholders return on equity.
As part of the move to review MANA, M&M has taken a call to pull out from the bid to manufacture small delivery trucks for the United States Postal Service that is worth $6.3 billion. The company has written off the investment it had made towards this project, said Aneesh Shah, deputy managing director and group CFO at the firm. Mahindra was looking to set up a plant in Michigan in the US and had even signed a letter of intent with the RACER Trust, the Indian automaker had said in August 2019.
“The $500 million investment by us in MANA was subject to us winning the US postal services bid. We chose not to participate in that bid. We were shortlisted as the final four. What had been invested so far was a very small amount which was essentially in preparation of the bid and all of that has been written off, " Shah said.