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M. Ramesh

Officials of CG Igarashi Motors told Business Line that this was a part of the collaborator's creeping acquisition strategy.

CHENNAI, March 22

IGARASHI Electrical Works of Japan has raised its stake in its Indian joint venture, CG Igarashi Motors Ltd, from 44.98 per cent to 48.98 per cent.

The stake hike was approved by the Foreign Investment Promotion Board (FIPB) on Friday.

Officials of CG Igarashi Motors told Business Line that this was a part of the collaborator's creeping acquisition strategy. Earlier this year, Igarashi Electrical had raised its stake from 40 per cent to 48.98 per cent.

However, as SEBI has since allowed foreign collaborators to increase their stake through the creeping acquisition route up to 10 per cent, there was a room for Igarashi to raise its stake further this year. Hence, the stake hike now.

It is understood that one of the original promoters of the company, IL&FS Ventures, which held 8.7 per cent in CG Igarashi Motors, has sold off its stake entirely, which has been picked up by the Japanese collaborator.

CG Igarashi Motors manufactures micro motors for use in automobiles.

In the first nine months of the current year, its turnover was Rs 76.32 crore, as against Rs 64.28 crore in the same period last year, and Rs 92.78 crore for the whole of last year.

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