Iran Khodro shifts to private management
Iran's automotive industry witnessed a significant shift as Iran Khodro (IKCO), the country's largest automaker, transferred management control to private sector company Crouse Group following a contentious nine-hour extraordinary general meeting. The meeting, which reached quorum with 50.11% shareholder attendance after a seven-hour delay, resulted in the appointment of a new board dominated by Crouse Group-affiliated companies.
The transition marks a pivotal moment for IKCO, known for producing older Peugeot models, which has historically struggled with profitability and required government bailouts. The management change came despite attempts to postpone the meeting, as indicated by a controversial notice on Iran's Codal stock exchange system citing disagreements between major shareholders.
The new board includes Ganjineh Iranian Investments, Behineh Sazan Bahman Company, Etebar Afarin Company, National Investment Management of Iran, and Saba Energy. Crouse, Iran's largest auto parts manufacturer, had been strategically acquiring shares of major automakers through affiliated companies, despite criticism over the quality of automotive components.
The transition reflects broader governmental tensions, with President Pezeshkian's administration and the Ministry of Economy supporting privatization, while the Ministry of Industry and state-affiliated bodies attempted to maintain government control. The Supreme Economic Coordination Council has outlined a framework for the transfer, suggesting a phased approach beginning with management control before ownership transfer.
While IKCO's stock remains suspended, causing investor frustration, initial market reactions indicate optimism about reduced government interference and potential improvements in corporate governance. The move represents a significant transformation for Iran's automotive sector, though the company's future performance under private management remains to be evaluated.
