Hero Honda Motors Ltd today said it had executed a final binding licencing agreement with Japan's Honda Motor Co.
The agreement paves the way for the Japanese company to exit Hero Honda Motors, its joint venture with the Munjals-promoted Hero Group.
The agreement pertains to the existing and new products that Hero Honda Motors will offer in the Indian market once the sale of the Japanese firm's stake to Hero Group is concluded.
Hero Honda is a 26-year-old JV between the Hero Group and Honda Motor Co, with each partner holding a 26 per cent stake. As per their agreement, the Hero Group will buy Honda Motor's 26 per cent stake in Hero Honda.
The licencing agreement, which was executed last week, is in line with the Memorandum of Understanding (MoU) approved by their respective boards of directors on December 16, 2010, Hero Honda Motors said in a filing to the Bombay Stock Exchange (BSE).
Meanwhile, shares of Hero Honda were trading at Rs 1,746.50 on the BSE, down 0.54 per cent from the previous close, in early trade today.