Active Stocks
Thu Mar 28 2024 15:48:07
  1. Tata Steel share price
  2. 155.90 2.00%
  1. ICICI Bank share price
  2. 1,095.75 1.08%
  1. HDFC Bank share price
  2. 1,448.20 0.52%
  1. ITC share price
  2. 428.55 0.13%
  1. Power Grid Corporation Of India share price
  2. 277.05 2.21%
Business News/ Market / Stock-market-news/  Volvo exits Eicher Motors, sells 3.7% for Rs1,695 crore
BackBack

Volvo exits Eicher Motors, sells 3.7% for Rs1,695 crore

Shares of Eicher Motors fell 5.64% to `17,182.35

Earlier in March, Volvo sold around 4.7% stake in Eicher Motors for over `1,920 crore by selling 12.7 lakh shares. Premium
Earlier in March, Volvo sold around 4.7% stake in Eicher Motors for over `1,920 crore by selling 12.7 lakh shares.

New Delhi: Swedish commercial vehicle major Volvo on Thursday exited Eicher Motors by selling its residual 3.7% stake in the Indian firm for about 1,695 crore.

“The Volvo Group has sold its remaining holding in the listed Indian automotive manufacturer, Eicher Motors Limited. The sale corresponds to 10,05,610 shares with a total value of approximately SEK 2.2 billion (about 1,695 crore)," Volvo said in a statement.

The divestment of shares has no effect on ownership or development of the long-standing joint venture, VE Commercial Vehicles (VECV), it clarified. The sale will have a positive impact on the Volvo Group’s cash flow after net investments and net financial debt in a corresponding amount in the second quarter of 2015, the company said.

Volvo said the sale will also “generate a capital gain of approximately SEK 2.1 billion, which will impact operating income in the trucks segment in the second quarter of 2015".

Earlier in March, Volvo sold around 4.7% stake in Eicher Motors for over 1,920 crore by selling 12.7 lakh shares. In May 2008, Volvo and Eicher Motors Ltd (EML) had got into a joint venture agreement to create VECV with an intent to drive modernisation in the commercial vehicle space in India and the developing world.

As part of the transaction, in addition to acquiring 45.6% of the shareholding of VECV, AB Volvo had also taken 22.75 lakh shares of EML representing 8.4% of equity capital of the company. Volvo had insisted that its selling of stake in Eicher Motors would not change the shareholding pattern and governance framework of VECV.

“Both the joint venture partners are committed to nurture this further in the exciting period that lies ahead, as the commercial vehicle industry looks to revive after a long period of downturn," it had said. VECV’s business includes the complete range of Eicher trucks and buses, VE Powertrain, Eicher’s components and engineering design services as well as the sales and distribution business of Volvo trucks within India.

Eicher Motors Ltd on Thursday fell 5.64% to 17,182.35 on BSE, while Sensex fell 0.09% to 26,813.42 points.

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Published: 04 Jun 2015, 10:51 AM IST
Next Story footLogo
Recommended For You
Switch to the Mint app for fast and personalized news - Get App