Premier Asks M & M, Telco To Bail Out Pal-Peugeot

Premier Automobiles Ltd has approached auto majors Mahindra & Mahindra and Telco to bail out PAL-Peugeot Ltd (PPL). Both PAL and Peugeot have announced their decision to pull out of the beleaguered joint venture.

Industry sources said Premier has sent feelers to auto majors to pick up a 64 per cent stake in PPL, representing the respective 32 per cent stakes of both partners.

Sources added that Telco has already declined while M&M is still considering the offer. After Peugeot pulled out of PPL, PAL had reconsidered its options and even talked to Fiat, its other joint venture partner. When those efforts failed, PAL last week announced that it too would sell its stake in the company.

Meanwhile, French major Renault is said to have jumped back into the fray for PPL. Renault had earlier been talking to PAL but that was before Peugeot announced its pullout.

PAL officials said they were considering various options to save PAL-Peugeot. Nothing has crystallised yet, they added. They also expressed ignorance about PALs proposals to M&M and Telco and any fresh interest on Renaults part.

Industry sources hinted that Skoda, the Czech subsidiary of German major Volkswagen, could also be interested in PPL. Skodas talks with Eicher Motors for a joint venture had failed and the company is known to be scouting around for an entry point into the Indian market.

The Doshis of Premier Automobiles are also known to have approached their old friend Rahul Bajaj, apart from M&M and Telco. However, their efforts failed as Bajajs interest in a car project had waned in the past one-and-a-half years.

Meanwhile, it is learnt that IL&FS has been appointed to find a buyer for Premiers stake in PPL. PAL officials denied this. We have not asked IL&FS to find us a buyer, the officials said.