Mahindra & Mahindra (M&M) on Wednesday (11 March 2020) said it signed an agreement for purchasing additional 34,249 equity shares of M.I.T.R.A. Agro Equipments, an associate of the company, from its existing shareholders.
M&M currently holds 26% (on a fully diluted basis) of the equity share capital of M.I.T.R.A. Agro Equipments (Mitra). Post completion of the above transaction, the company will hold approximately 39% of the equity share capital of Mitra on a fully diluted basis.M.I.T.R.A. Agro Equipments is an Indian company, which manufactures and sells agricultural sprayers. It had a turnover of Rs. 22.1 crore during the financial year 2018-19.
M&M said that the purchase of additional equity shares in Mitra would support the company's farm equipment sector's growth in the horticulture sector. Post the acquisition of equity shares, Mitra would continue to remain an associate of the company.
The company expects to complete the transaction by end of March 2020. The total cost of the said acquisition stood approximately at Rs 7.1 crore, it added.
Shares of M&M slumped 10.14% to Rs 406.65 in a broader market carnage. It traded in the range of Rs 400 and Rs 431.55 so far during the day.
M&M's segments include automotive, farm equipment, financial services, real estate, hospitality and others. Automotive segment comprises of sale of automobiles, spares, mobility solutions and construction equipment. Its farm equipment segment comprises of sale of tractors, implements and spares.
On a consolidated basis, the company's net profit slumped 84.7% to 199.94 crore on a 4.5% fall in net sales to Rs 25019.86 crore in Q3 December 2019 over Q3 December 2018.
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