Volvo, Eicher set up CV venture

Sweden-based Volvo AB and Delhi-based Eicher Motors today announced a joint venture in India, the fifth biggest commercial vehicles market in the world, which will take on leaders Tata Motors and Ashok Leyland by selling the full range.

Volvo, the world's second-largest truck maker, will infuse $350 million for a direct holding of 45.6 per cent and spend an undisclosed amount to buy 8.1 per cent in Eicher Motors for a total control of 50 per cent in the new company.

Volvo will add its Indian truck sales business, valued at $75 million, and $275 million in cash to the venture.

Eicher Motors will transfer its commercial vehicles, components and engineering businesses to the new company, in lieu of which it will get 54.4 per cent equity in the new venture that is yet to be named.

According to a statement, the new company will be