Mahindra & Mahindra Ltd (M&M) has completed purchase of Navistar International Corporation’s stake in Mahindra Navistar Automotives Ltd (MNAL) and Mahindra Navistar Engines Pvt Ltd (MNEPL).
The two companies are now wholly owned subsidiaries of M&M which will continue to sell MNAL and MNEPL products. M&M had held a 51 per cent stake in both companies, while the US-based Navistar held the rest .
The value of the buy out was around Rs 175 crore.
Turnaround strategy
In December 2012, Navistar said it was exiting the joint ventures as part of its “Drive to Deliver” turnaround strategy, which is focused on strengthening its North American core businesses and pursuing near-term initiatives to improve the company’s return on invested capital (ROIC) performance.
The December agreement allows Navistar to continue sourcing components from India, while Mahindra would continue to provide engineering services to Navistar.
The Navistar group will continue to support M&M through licence agreements and extend necessary support to MNAL and MNEPL for the purposes of business
M&M said it is fully committed to the truck and engine companies and would focus on further leveraging synergies between these two businesses and the Mahindra Group to make the commercial vehicles business a success.
New models launched
The truck company recently launched a range of new models including the 25T Tipper with Bogie suspension and integrated applications like 31T Coal Haulage Tipper and Transit Mixer.
Future plans include the launch of Refrigerated Trucks on the MN25 platform which is a fast-growing market.
Mahindra, for its truck business, has 59 dealers and nearly a thousand service points across India.