Photo: File

 
SAIC Group on Monday refuted media reports that its subsidiary MG Motor India is forcibly acquired at low price.
 
In an official statement on its WeChat account, the group clarified that the reports deviated from the facts and stated that any equity transactions involving MG Motor India require approval from the Chinese government. 

The group emphasized that it will announce official information regarding the matter in due course.

SAIC Group holds a controlling stake in MG Motor India. Any equity transactions involving MG Motor India require approval from the Chinese government, and the group will announce official information in due course, according to the statement.

The clarification came in response to Indian media reports suggesting that the Jindal Southwest Group (JSW) was attempting to acquire a portion of MG Motor India's shares. 

JSW is expected to hold 45percent to 48 percent of the shares of MG Motor India, while dealers and Indian employees will hold 5 percent to 8 percent of the shares, making SAIC Motor lose control of its Indian subsidiary and MG Motor India a company controlled by Indians.

SAIC Group entered the Indian market in 2017 and established its production base in 2019 for manufacturing new energy and internet-connected vehicles under the MG Motor brand. The ownership of MG Motor India has garnered attention due to increased scrutiny and limitations on Chinese investments imposed by the Indian government.

The ownership of MG Motor India created much attention because Chinese investment in recent years is facing increased scrutiny and limitation by the Indian government despite their significant contributions to India's economic development in the past years.

As a latest example, India has reportedly intensified a crackdown on Chinese smartphone companies operating in the South Asian country.

The Indian government has asked Chinese mobile phone makers including Xiaomi, OPPO, Realme and Vivo to bring local equity partners into their local operations and appoint Indian nationals in key roles such as CEO, Indian media outlet The Economic Times reported on June 13.

Last November, the government asked MG to explain why it posted a loss in 2019-2020, its first year of operations, Reuters reported.

This year, SAIC's total overseas sales are expected to exceed 1.2 million vehicles, achieving scaled profitability, the group said in the statement.

SAIC's accumulative sales in overseas markets from January to May reached 438,000 vehicles, accounting for 26.3 percent of its total sales during the period, according to sales data from the group.

In the first quarter SAIC achieved operating income of 145.96 billion yuan ($20.18 billion), down 20.43 percent year-on-year, the financial results showed.