M&M proposes to spin off land, sea defence units
06 March 2009
Mahindra & Mahindra has sought shareholders' approval to spin off two divisions of its defence unit into separate subsidiaries.
M&M has sought shareholders' approval for transferring the land systems and naval systems divisions of Mahindra Defence Systems into separate companies, the company said in a filing with the Bombay Stock Exchange (BSE).
M&M said it was evaluating various options in defence equipment manufacturing and was also looking at the possibility of forming joint ventures with strategic partners for carrying on the business of the two proposed entities.
"Accordingly, it is likely that the company may in future divest, transfer and/or otherwise dispose its investments in the foregoing two subsidiaries engaged in the land systems and naval systems businesses, to any suitable third party(ies) at an appropriate value," it said.
While the board had approved the transfer of its land services and naval systems business of Mahindra Defence Systems Division to separate companies, a decision is expected on 9 April after shareholders vote on the proposal, the company said.
Mahindra Defence Systems caters to the requirements of the defence sector and provides solutions for armoured vehicles and their derivatives.
Mahindra Defence Systems provides total solutions for the entire range of light combat / armoured vehicles and their derivatives for defence / security forces. It also addresses specific segments of the government's import substitution/indigenisation programmes like small arms and sea mines.