Transaction Overview

Partnership Structure

Sona Comstar signed definitive agreements with DENSO Corporation to establish two joint ventures for developing, designing, manufacturing, and marketing advanced electric and hybrid powertrain systems across multiple vehicle segments.

Joint Venture for Four-Wheeler and Larger Applications

  • Focuses on high-voltage liquid-cooled traction inverters, traction motors, and generators for electric and hybrid passenger vehicles, commercial vehicles, and other high-voltage applications
  • DENSO will hold 51% equity stake and assume management control
  • Sona Comstar will hold 49% stake and contribute engineering capabilities, manufacturing expertise, and supply chain ecosystem
  • Partners entered into a Joint Development Agreement (JDA) to develop high-efficiency products

Joint Venture for Two-Wheeler and Three-Wheeler Applications

  • Sona Comstar will transfer its existing electric traction motor and controller business for two-wheelers and three-wheelers into a wholly owned subsidiary through slump sale
  • DENSO (or affiliates) will acquire 49% equity stake in the entity at an enterprise value of INR 17,500 million (₹1,750 crore)
  • Sona Comstar will retain 51% stake and management control
  • Business will include air-cooled traction inverters, traction motors, generators, and e-Axles for electric and hybrid two and three-wheelers

Intellectual Property Arrangements

Both DENSO and Sona Comstar shall license intellectual property and know-how to their respective majority-owned joint ventures against payment of royalty.

Conditions Precedent

The transaction is subject to receipt of relevant regulatory approvals and customary closing conditions mutually agreed between the parties in the definitive agreements.

Management Commentary

Mr. Vivek Vikram Singh, MD and Group CEO of Sona Comstar

Described the partnership as an "historic milestone" reflecting capabilities built across advanced electric powertrain systems. Noted DENSO's forefront position in automotive innovation globally with deep expertise in electrification technologies. Stated the partnership will accelerate growth of existing electric powertrain business for two and three-wheelers by strengthening capabilities across the powertrain value chain.

Mr. Tsuneo Maebara, Head of Powertrain Systems Business Group at DENSO Corporation

Highlighted India as an important region where diverse forms of mobility coexist and electrification is advancing at significant scale. Recognized Sona Comstar as a mobility technology company with global business presence that has transformed alongside the rapid evolution of the mobility market.

Advisory Team

Deloitte India acted as financial advisor, Trilegal as legal advisor, and KPMG India as diligence & tax advisor to Sona Comstar for this transaction.