Japanese Mitsui buys 18.5% stake in ACI Motors for $22.75 million

Japanese Mitsui & Company, through its Singaporean subsidiary, has acquired some 18.5% stake from two existing investors of ACI Motors for $22.75 million, equivalent to approximately Tk270 crore, according to insiders.

Mitsui, in a public statement on 29 November, had announced the investment without disclosing any numbers. However, it expressed its interest to provide "integrated mobility and mechanisation solutions for agri-businesses, transportation, and infrastructure through the strategic partnership with ACI." 

Meanwhile, having the deal closed, ACI Motors now eyes leveraging the strategic partnership with the top-tier multinational Japanese conglomerate.

The company plans to fuel its growth through expanding in areas such as passenger vehicle, electric vehicle, rice processing, and exploring export markets for its locally made agro machineries, according to its Managing Director FH Ansarey.

Ansarey further told The Business Standard yesterday that the ACI Motors will get two top level executives from Mitsui who will add value to the company's strategic decision-making.

Mitsui, having offices in 61 countries and over $100 billion annual turnover, operates in the areas ranging from trading, logistics and financing, infrastructure, energy, mobility, chemicals, iron and steel products, food and retail management, wellness, IT and communication and corporate development businesses, according to its website.

Ansarey said, "We are looking to enter the car business and Mitsui's global expertise and exposure will help us."

"They could also assist us in entering and expanding into the business of large-scale rice processing facilities and exporting Bangladesh-made agro machineries," he added.

In its statement, Mitsui expressed interest in retail and logistics, citing the rapid growth of the consumer market in Bangladesh.

ACI Motors, the mechanical and automobile arm of ACI Limited – one of the country's largest conglomerates – is a top growing company specialising in agro machineries, construction equipment, generators, two-wheelers, and commercial vehicles, with partnerships with leading global brands.

The company has an annual revenue exceeding Tk3,000 crore, with steady profit and sales growth. 

During the pandemic, ACI Motors attracted several foreign investors, including Dutch development financier FMO, British International Investment, Norwegian government's Norfund, and Singapore-based SDI. 

According to insiders, a key promoter sold nearly 14% ACI Motors shares to Mitsui while the rest was sold by the foreign investors' private equity vehicle, Bangladesh Managed Account CV.

Foreign investors' shares issued in 2021 are convertible preference shares that the investor may convert into common shares at their will, they added.