AB Volvo divests 12.7 lakh shares (4.7pc) of Eicher Motors
Date: 04 Mar 2015
AB Volvo has divested 12.7
lakh shares, representing approximately 4.7pc of Eicher Motors Limited’s equity
capital.
According to a company
release, this divestment will have no bearing whatsoever on Volvo Eicher
Commercial Vehicles (VECV), which will continue to be governed as an equal
partnership venture. AB Volvo has a shareholding of around 45.6pc in VECV. It
may be recalled that in May 2008 AB Volvo and Eicher Motors Limited (EML) entered
into a Joint Venture agreement to create VECV with the intent to drive
modernisation in the commercial vehicle industry in India and the developing
world.
As a part of the transaction,
in addition to acquiring 45.6pc of the shareholding of VECV, AB Volvo had also
acquired 22.75 lakh shares of EML representing 8.4pc of equity capital of the
company. AB Volvo has now divested 12.7 lakh shares, representing approximately
4.7pc of Eicher Motors Limited’s equity capital.
The Eicher statement said that
this divestment will have no bearing whatsoever on VECV, which will continue to
be governed as an equal partnership venture. The shareholding pattern and
governance framework of VECV remains unchanged. Both partners- Eicher Motors
Limited and AB Volvo are equally committed to grow the business together. Since
its formation, VECV has been growing from strength to strength, outpacing the
industry across various segments and gaining market share with breakthrough
products and a lean business model. Since inception, VECV has made many
strategic investments. The more significant of these investments are:
-Pro series, a modern range of
Eicher trucks and buses that both partners strongly believe represents the
future of commercial vehicles in India
-Medium duty engine facility,
i.e. Volvo group’s supplier of Euro 6 medium duty engines
-Creation of highly capable
and optimal industrial set up including bus body facility