UPDATE 1-Spain's CIE to take majority stake in Mahindra's auto parts unit
* CIE to hold 51 pct stake in new entity Mahindra CIE
* Mahindra CIE Automotive will have annual sales of $3 bln
* Mahindra to buy 13.5 pct in CIE for $125.7 million (Adds deal and financial details, comments from management)
By Aradhana Aravindan and Sumeet Chatterjee
MUMBAI, June 15 (Reuters) - Spain's CIE Automotive SA will buy a majority stake in the combined auto component unit of India's diversified Mahindra Group for about $116 million to get access to new markets and supply networks.
Separately, the group flagship Mahindra & Mahindra Ltd , India's largest sports utility vehicle maker, has agreed to acquire a 13.5 percent stake in CIE for 94.24 million euros ($125.72 million).
As part of the complex deal announced on Saturday, Mahindra, a $16 billion group that has interests in businesses including automobile and information technology, will merge all its auto components businesses into its Mahindra Forgings unit.
Mahindra Forgings will be renamed Mahindra CIE Automotive, in which Spanish auto components maker CIE will hold 51 percent and Mahindra will own about 20 percent. The rest will be held by institutional and public shareholders.
Mahindra CIE will become one of the top 25 global auto component suppliers, with annual sales of $3 billion and operations from North America to Asia. Continuación...