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Business News/ Companies / News/  Ashok Leyland sells entire stake in Avia for $10.96 million
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Ashok Leyland sells entire stake in Avia for $10.96 million

The move is a part of restructuring of investment in subsidiaries

Ashok Leyland shares rose 6.32% to Rs74 on BSE, while the benchmark Sensex gained 1.88% to 27,975.86 points. Photo: BloombergPremium
Ashok Leyland shares rose 6.32% to Rs74 on BSE, while the benchmark Sensex gained 1.88% to 27,975.86 points. Photo: Bloomberg

Chennai: Ashok Leyland Ltd, the second largest Indian truck and bus maker, on Monday said that it had sold its entire stake in its unit Avia Ashok Leyland Motors for $10.96 million to a strategic investor.

The Chennai-based vehicle maker on Monday told the stock exchange that the move was part of restructuring of investments in its units. The firm also sold its entire 48.5% stake in Ashok Leyland Wind Energy Ltd to a buyer whose name was not disclosed; the sale earned it 6 crore in profit.

Ashok Leyland shares rose 6.32% to 74 on BSE, while the exchange’s benchmark Sensex gained 1.88% to 27,975.86 points.

Ashok Leyland bought Czech-based Avia for $35 million; the sale at $10.96 million could mean a one-time loss that could impact its quarterly financial results, said Tushar Pendharkar, an analyst at Right Horizons Financial Services.

Ashok Leyland had total debt of 3,700 crore and cash and current investments were at 424 crore as on 30 September 2014. So, the sale proceeds of $10.96 million (about 68.5 crore) from Avia and another 6 crore from the stake sale in its wind energy firm will not help it cut debt much, said Pendharkar.

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Published: 30 Mar 2015, 06:06 PM IST
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