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| Kinetic plans foray into making of auto parts |
| Abhineet Kumar / Mumbai Aug 01, 2008, 00:55 IST |
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Kinetic Motor Company, the Pune-based scooter-maker, which sold its business assets to Mahindra and Mahindra for Rs 110 crore on Wednesday, is now considering to get into the auto components business.
“Auto component is one of the options that we are considering as a new operating business for Kinetic Motor now,” said Sulajja Firodia Motwani, managing director, Kinetic Motor.
While the company is spending almost the entire amount of Rs 110 crore to repay its debt, it will get some additional sum as the value for current inventory. Besides, its real estate assets are valued at around Rs 30 crore to Rs 40 crore. The company will use some of its real estate assets to create the new business.
Kinetic Auto Components, a sister concern of Kinetic Motor Company, is already into auto components business and makes engines, gears, starter motors and other such products for two-wheelers.
However, the company said it was also looking at other possible options as the new operating business for the company.
Kinetic Motor has also got a 20 per cent stake in the new joint venture with Mahindra, which will now take over the two-wheeler business. This stake is valued at around Rs 27.5 crore at the current valuation. The company also has a put option to unlock the value of this stake in seven years.
Mahindra & Mahindra will benefit from the strong Kinetic brand, which will help it get customers instantly.
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