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Home arrow Automotive arrow Force Motors to sell 55.8Mn equity shares of MAN Force Trucks to MAN
Force Motors to sell 55.8Mn equity shares of MAN Force Trucks to MAN Print E-mail
Written by Vivek   
Tuesday, 22 November 2011
Mumbai: MAN Truck & Bus is taking over the Indian joint venture MAN FORCE TRUCKS Pvt. Ltd. Force Motors Limited, Pune, India (Force Motors) and MAN Truck & Bus AG, Munich, Germany, (MAN) the Joint Venture Partners of MAN FORCE Trucks Pvt. Ltd (MFTPL) have arrived at an in principle agreement, subject to receipt of approvals, to reorganise their shareholding in the equity share capital of MFTPL and to re-arrange their relationship in respect of MFTPL.

Subject to receipt of necessary approvals, Force Motors will sell and transfer 55,797,100 equity shares of MFTPL to MAN, for a consideration of Euro 150,000,000 (Euro One Hundred and Fifty Million). Subject to the receipt of the necessary approvals it is envisaged to close the transaction before the end of the year.

MAN Truck & Bus and FORCE Motors will be cooperating in future, too. FORCE Motors will, for example, continue to supply parts and components for production of the MAN CLA.

Force Motors had conceived in 2003 a project for industrializing in India new generation heavy commercial vehicles. For this purpose, Force Motors had sourced technology from leading German companies like MAN for Engines, Cabs and Axles and from ZF for gearboxes. Based on this licensed technology, Force Motors created a full range heavy vehicles. In 2006 on MAN's request, with a view to achieve substantial export, this project of Force Motors was converted into a joint venture with 30 % equity with MAN. A new company MAN FORCE Trucks Pvt. Ltd. was formed, the joint venture between Force Motors and MAN. This is engaged in the business of manufacture of Heavy Commercial Vehicles. Later on in 2008 the equity proportion was adjusted to increase MAN shareholding to 50 %. After some initial difficulties in the starting phase the production has been ramped up stepwise. The products range from chassis to tippers for the construction industry and semitrailer tractors for long-haul transport.

In purchasing the shares held by FORCE Motors Ltd., MAN Truck & Bus is assuming sole responsibility for production and sale of the MAN CLA inside and outside India.

With this strategic investment, which is conceived as a long-term commitment, MAN Truck & Bus is underlining the great significance of the Indian market in the context of its BRIC strategy. "In the last few years we have greatly benefited from the experience of our partner FORCE Motors; its knowledge of the Indian market and its long-standing links to local suppliers have been a great help to us as we built up our activities in India. Now we want to and will expand this business on our own," explained Dr. Georg Pachta-Reyhofen, CEO of MAN SE and MAN Truck & Bus AG.

MAN Force has a manufacturing facility at Pithampur, MP. MAN Force trucks are exported overseas to countries such as Sri Lanka, Indonesia, and certain African nations.

Last Updated ( Tuesday, 22 November 2011 )
 
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