Mahindra & Mahindra has acquired 35 per cent stake in Finland's Sampo Rosenlew for up to 18 million euros (about Rs 135 crore), marking its foray into the combine harvester business.
The deal is expected to close by June 30, 2016.
"The acquisition of up to 35 per cent stake would be for a consideration of not exceeding 18 million euros," Mahindra & Mahindra (M&M) said in a regulatory filing today.
Both will work in tandem to grow their combine harvester business globally, it added.
"We are now putting in place a strategy to build a full product line of farm equipment that goes beyond tractors and with this we will compete globally in both advanced and developing markets," said Pawan Goenka, Executive Director of M&M.
At present, Mahindra is the world's leading tractor company by volume, with an on ground presence in India, the US, China and Japan, besides many other export markets.
M&M Farm Equipment and two-wheeler President and Chief Executive Rajesh Jejurikar said: "Sampo Rosenlew will enable Mahindra to grow in the global combine harvester business. The two companies will work closely towards taking Sampo's combine harvesters to new markets globally, including India."
In 2014-15, Sampo Rosenlew had a standalone revenue of 93 million euro. The company is also joint venture partner in a combine harvester company in Algeria which had a revenue of 45 million euro in the same year.
Further, it has built a significant business in its core markets like Europe, Eurasian countries and North Africa.
Together with its existing strategy in the core markets, Sampo Rosenlew will also develop a new range of combine harvesters for developing markets and for specialty crops, M&M said.
"Mahindra and Sampo Rosenlew will jointly focus on the combine harvester business in Asia, Africa and Eurasian Economic Union countries," it added.
M&M shares were trading 0.76 per cent down at Rs 1,210.95 apiece during afternoon session on the BSE.
Mr. Rajan Wadhera, President & Chief Executive - Truck &
Power Train, and Head - Mahindra Research Valley, Mahindra & Mahindra Ltd. Said, "At the core of the mileage guarantee that we are offering for the Blazo series of trucks is the FUELSMART technology of our mPOWER CRDE engine. In commercial vehicles there is a challenge to provide a single solution of engine and vehicle power-train configuration to multiple applications and variants. The FUELSMART technology, with its multi-mode switches, will help drivers in choosing the correct mode based on load and road conditions, thereby leading to efficiencies."
Mr. Nalin Mehta, Chief Executive Officer, Mahindra Truck and Bus Division, Mahindra & Mahindra Ltd . Said, "Our Mileage guarantee is a clear vindication of our engineering excellence and our resolve to provide better value proposition to customers. The service guarantee is the outcome of our strong focus on after-sales network by leveraging group synergies and organic growth in the service touch points and spares retailer network. Continuous product innovation and customer centricity is at the core of MTBD which has made these guarantees possible.
He further added, "We have aggressive marketing plans to promote the new Blazo series. Besides bringing in the new technology, we have even refreshed the looks of the new series and are introducing the new turquoise blue colour variant. Also, given the sincere confidence that the brand exudes, we have chosen the suave, dashing, macho, popular and well renowned Bollywood actor Ajay Devgan to be the face of our new campaign, featuring the product and service guarantees."
About Mahindra Truck and Bus Division:
Mahindra Truck and Bus Division is a part of the automotive and farm sector of the USD 16.9 billion Mahindra Group that provides an entire line of integrated trucking solutions.
