Hindustan Motors is considering sale of some more assets – investments and land – to raise funds.

Its board member and former Managing Director, Mr A. Shankara Narayanan, told reporters after an EGM here on Wednesday that to arrest financial deterioration and stay firm on the recovery course, the automaker was likely to offload certain investments and properties.

Promoters' shareholding up

Shareholders approved proposals to allot 1.18 crore shares and 1.18 crore warrants to the promoters at the EGM. Both shares and warrants (of Rs 5 each) will carry a premium of Rs 7.25.

For allotment of shares, the promoter shareholding will increase from 27.22 per cent to 32.19 per cent and to 36.52 per cent on conversion of warrants into shares. However, increase in shareholdings will be restricted to 5 per cent of the enhanced paid-up capital within a financial year.

Pajero sports

Mr C.K. Birla, Chairman of the company, said that Hind Motors was introducing a new diesel-driven sports utility vehicle – Pajero Sports – on March 12 under licence from Mitsubishi Motors Corporation.

Hind Motors appointed Mr Uttam Bose as Managing Director on Wednesday. He will join on April 2. The previous two Managing Directors did not finish their five-year term. Currently, Mr Narayanan is looking after the management as an “advisor.”

The capacity utilisation at its Chennai plant is around 40 per cent, while its plant near here is largely unused, but has 503 acres on 99-year lease. The Chennai unit is on 170 acres.

At Pithampur (Madhya Pradesh) it has 35 acres, a company official said. Among the investments, Avtec, which makes auto engines for General Motors, is the key. Hind Motors holds around 35 per cent in this joint venture between the CK Birla Group and private equity Actis.

> jayanta_mallick@thehindu.co.in

Related Topics