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Old 6th June 2015, 15:18   #1
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Default Volvo divests 8.4% share in Eicher Motors

Volvo Eicher Commercial Vehicles (VECV) is a joint venture that was created in 2008. As a part of the agreement between AB Volvo and Eicher Motors Limited (EML), Volvo acquired 22.75 lakh shares (8.4%) of EML, along with the 45.6% share in VECV. Volvo has now divested its 8.4% share in EML and the move has no relation with / will have no impact on the VECV joint venture.

VECV will continue to function as it always has and Volvo divested its share in EML because the brand didn’t find the stake strategically important. The VECV JV includes the complete range of Eicher branded trucks and buses, VE powertrains, Eicher’s components and engineering design services businesses, the sales and distribution business of Volvo Trucks as well as aftermarket support to Volvo Buses in India.

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Last edited by Tushar : 6th June 2015 at 15:20.
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Old 8th June 2015, 14:25   #2
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Default Re: Volvo divests 8.4% share in Eicher Motors

Just wanted to drop a short note as there's a lot of confusion around this move (even Economic Times got it wrong initially).

The Volvo-Eicher Commercial vehicles JV stays as is. There is NO change; they'll continue to make & sell trucks & buses.

What Volvo has done here has sold its shares in the (standalone) Eicher Motors, who - among other vehicles - makes Royal Enfield motorcycles. Eicher Motors is a separate organisation from Volvo-Eicher.
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Old 8th June 2015, 15:14   #3
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Default Re: Volvo divests 8.4% share in Eicher Motors

Quote:
Originally Posted by Tushar View Post
Volvo ..... only
Quote:
Originally Posted by GTO View Post
Jus....cher.

A small calculation from my part,please correct me if I'm wrong.

Eicher motors stock price on July 2008 ( Date VECV started according to their web site)
250 approx

Eicher motors stock price on June 2015
18450 approx

Worth of stock divested by Volvo = 22,75 Lakh shares

Profit = 22,75 Lakhs * (18450 - 250 ) = 4,14,050 Lakhs!!!

Or 4140 Crores

Whoa, Now that is awesome business by Volvo!

Last edited by batterylow : 8th June 2015 at 15:22. Reason: Adding Quote and changing numbers
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Old 16th June 2015, 23:22   #4
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Default Re: Volvo divests 8.4% share in Eicher Motors

Quote:
Originally Posted by batterylow View Post
A small calculation from my part,please correct me if I'm wrong.

Eicher motors stock price on July 2008 ( Date VECV started according to their web site)
250 approx

Eicher motors stock price on June 2015
18450 approx

Worth of stock divested by Volvo = 22,75 Lakh shares

Profit = 22,75 Lakhs * (18450 - 250 ) = 4,14,050 Lakhs!!!

Or 4140 Crores

Whoa, Now that is awesome business by Volvo!
The sale of this many shares by Volvo is bound to reduce the stock price right? Won't it harm the company?? Huge profit for Volvo though.
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