Automart India, the national used-car chain promoted by Mahindra & Mahindra, Sah & Sanghi and HDFC, has divested an 18 per cent stake in the company to a strategic investor to fund its expansion plans.
Sah & Sanghi, the Mumbai-based dealers for Maruti Udyog, has also increased its stake in the company to 20 per cent, from around 11 per cent earlier.
Following the divestment and additional investments made by Automart India, Mahindra & Mahindra's stake in the company has come down to 47 per cent from 57 per cent earlier.
HDFC's holding too has been reduced to around 10 per cent (from 22 per cent earlier).
The developments have also halved employees' stake in the company to five per cent as a result. Vinay Sanghi, head of Automart India, confirmed the development, but declined to name the strategic investor, or the amount invested by them, saying, "we will announce it at an appropriate time."
Meanwhile, the company has tied up with Hyundai Motor India to jointly promote an exchange offer at Hyundai's dealerships.
As part of the alliance, Automart India will evaluate and purchase second-hand vehicles from customers who want to exchange their old cars for new Hyundai models.
The old cars will then be sold through Automart's dealership network. Automart India, which has already opened five used-car dealerships during the past six months -- at Mumbai, Delhi, Bangalore, Chennai and Pune -- is also close to tying up with another multinational auto company for rolling out more dealerships, where the auto MNC will operate Automart's dealerships on a franchisee basis.
Sanghi said the name of the auto MNC would be announced shortly, but declined to give further details.
Currently, Ford India is the only other company having presence in the organised second-hand market for used cars through its outfit 'Ford Assured.'
Although Maruti Udyog and Daewoo Motors have also announced similar plans, they have not entered the fray yet.
