Piaggio, the Italian two-wheeler major, has bought out the Thapars' 49 per cent stake in Piaggio Greaves Vehicles (PGVL), the Pune-based three-wheeler manufacturer, for a consideration of Rs 31.50 crore. The development, which has been in the air for some time now, makes PGVL a wholly owned subsidiary of Piaggio, which sees India as a major growth area.
PGVL's board of directors has also approved divestment of Rajasthan Polymer & Resins (RPRL), in addition to the business groups I and II and other investments in its joint ventures, the company said in a notice to the Bombay Stock Exchange(BSE).
The board has also agreed to suspend production at the RPRL unit "for the time being", and to enter into a memorandum of understanding (MoU) for the divestment of Business Group III, which produces light diesel and portable engines with Lombardini, another Italian company.
Piaggio's buyout of the Thapars' stake comes after its exit from LML, the Lucknow-based scooters and motorcycles manufacturer, following a legal battle.
PGVL, which hopes to make India a major export hub, has last year announced plans to double its production capacity from 25,000 to 50,000, to emerge as a major exporter. The company is also understood to be considering making an entry into the four-wheeler market.
Following its exit from LML, Piaggio had last year bid for the state-owned Scooters India, which has been put on the block. However, as it emerged as the lone bidder, the department of disinvestment had decided to follow the open bidding system in order to maximise the proceeds from the disinvestment in the company. Under the open bidding system, the government intended to invite bids from other parties to bid higher than the highest bidder.
