Tata Motors on Thursday said that the company will buy the 49 per cent stake held by its partner Tata Marcopolo Motors (TMML) in the bus-making joint venture (JV) for Rs 100 crore. This will bring curtains to the 14-year old partnership and will make way for a smooth exit for the Brazilian company.
"After a successful venture in India, and as a consequence of its refreshed business strategy, Marcopolo S.A. has decided to exit from the JV and offered to sell its 49 per cent shareholding in the JV," Tata Motors said in its statement to the Bombay Stock Exchange (BSE) without elaborating further.
Shares of Tata Motors on Thursday were trading marginally up by 0.52 per cent at 183.45 on the BSE at around 1.00 pm.
Consequent to this transaction, TMML will become its wholly owned subsidiary. All technologies pertaining to existing bus body products manufactured will continue to vest with TMML, the company added.
Tata Marcopolo Motors is a 51:49 JV formed in 2006 between Tata Motors and Marcopolo S.A., one of the largest bus and coach manufacturers globally.
The JV has manufacturing facilities in Dharwad and Lucknow where it builds bus bodies on chassis supplied Tata Motors.
These buses are marketed by the company under the "Starbus" and "Starbus Ultra" bus brands, Tata Motors added.
In addition, as part of the transition, Marcopolo S.A. will continue to license the "Marcopolo" trademarks to TMML for a minimum of three years with a non-compete provision in India for a corresponding period, it added.
The company, Marcopolo S.A. and TMML intend to maintain an open channel for future collaboration opportunities around bus body designs and technical consulting services, said Tata Motors.
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