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| Tata Motors ups stake to 100% in Spanish bus firm |
| BS Reporter / Mumbai Oct 21, 2009, 00:57 IST |
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Picks up residual stake of 79% in Hispano Carrocera SA for an undisclosed sum, gets access to bus design and technology skills.
Tata Motors, India’s largest automobile producer by sales, has bought the remaining stake of 79 per cent in Hispano Carrocera SA, Spain’s largest bus and coach bodies manufacturer, for an undisclosed sum.
Tata Motors (TM) had paid ¤12 million (about Rs 70 crore) in 2005 for buying a 21 per cent stake in the Spanish company. Ravi Kant, now non-executive vice-chairman and then executive director of TM, was appointed chairman of Hispano.
The stake buy gave TM the access to Hispano’s design and technology in bus building. It also acquired the licence for brand rights of the Spanish company.
TM had the call option of buying the remaining stake of 79 per cent in Hispano, which it exercised today. It was also widely expected in the automotive industry that TM would eventually increase its stake in Hispano, mainly to reinforce itself as one of the world’s largest bus makers. The company currently ranks second in the world in bus making. The call option was exercised through mutual agreement with the other shareholder, Investalia SA, Spain, stated a release from TM. Hispano now becomes a fully owned subsidiary of Tata Motors.
“After the acquisition, the company will further strengthen the ongoing initiatives to improve operational efficiencies such as productivity improvement, cost reduction, and new product development, to improve market share of the company and enhance brand value. Tata Motors is confident that Hispano will now emerge as an even stronger force in the Spanish as well as global bus and coach markets,” the release added.
The Spanish company currently manufactures a variety of city and intercity touring coaches from two of its facilities located in Zaragoza in Spain and Casablanca in Morocco, North Africa. It also has commercial relations with more than 50 countries and a capacity to make almost 2,000 units every year.
Earlier this year, TM started commercial production at its newest plant in Dharwad, Karnataka, which is also the world’s biggest bus making facility, spread across 123 acres and a capacity to make 30,000 a year.
The plant is owned by Tata Marcopolo Motors, a 51:49 joint venture of Tata Motors and Marcopolo Motors, the Brazil-based, global leader in body building for buses and coaches.
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