May get control of British bus maker Optare as rival retires from fight.
Ashok Leyland has won a brief skirmish with Scottish bus maker Alexander Dennis for control of British company Optare, the UK media reported on Thursday.
‘Indian-owned Ashok Leyland, part of the Hinduja Group and one of the largest bus manufacturers in the world, told Alexander Dennis that its 26 per cent stake in Optare was not for sale “to anyone at any price”,’ reported London’s Financial Times.
The Indian bus maker owns a 26 per cent stake in Optare and recently announced its intention to treble it to 75 per cent in a deal that should secure the future of the North Yorkshire-based Optare, said the UK Press Association. Alexander Dennis announced its interest in Optare a week after Ashok Leyland said it planned to increase stake.
“The bus building industry has been impacted by a lack of trade credit insurance, which along with higher levels of export business, has placed "considerable pressure" on Optare's working capital requirements. A £12 million credit line will be made available to Optare if shareholders back the cut-price issue of shares to Ashok Leyland at a meeting on January 6. Optare, which employs more than 500 people, warned last week that it would be unable to continue trading if the share placing failed to go through,” reported the UKPA.
Ashok Leyland’s share prices closed Rs 22.75, up 0.44 per cent against a BSE Sensex which dropped 1.17 per cent. The company did not reply to an e-mail seeking comments.
Ashok Leyland earlier said the Optare acquisition would give it three kinds of benefits, including participating in the growth of the European bus market. It would have access to the products and technology of Optare, which could be modified and brought into India. Optare and Leyland could also jointly develop products and hold intellectual property together.
Optare is Britain’s leading maker of advanced low-floor integral buses and employs around 500 people across the group, principally at its new assembly facility in Sherburn in Elmet, Yorkshire. The company produces a wide range of fuel efficient buses.
