Munjals to pay Rs3841.83 crore for Honda's 26-% stake
08 March 2011
The BM Munjal-led Hero Group today said it would pay Rs3,841.83 crore for its Japanese partner Honda's 26-per cent stake in their joint venture Hero Honda.
The group also said it would raise funds from private equity firms, including Bain Capital and Lathe Investment, estimated at around Rs4,500 crore to finance its buyout through a stake sale of Hero Investments Private Limited (HIPL).
"Hero Investments Private Limited (HIPL), an investment company of the Hero Group stated that it is acquiring all of Honda's 26 per cent stake in HHML at Rs739.97 per share," the group said in a statement.
Honda currently holds 51,91,8750 shares in Hero Honda and at the said share prices, the total value of the buyout would work out to Rs3841.83 crore.
Additionally, the Hero group said it had also signed definitive agreements with PE firms BC India Private Investors II, an affiliate of Bain Capital LLC, and Lathe Investment Private Limited, a wholly owned subsidiary of Government of Singapore Investment Corporation (Ventures) Pvt Ltd.
HIPL would sell stakes to the PE firms to raise funds for acquisition of Honda's stake in Hero Honda, it added.