Piaggio and Tata Motors of India

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Piaggio and Tata Motors of India

Postby Jim C. » Wed Aug 25, 2010 8:35 am

Tata Motors is the company building the Nano, world's lowest priced automobile. And sick in this article means having ill health!


Tata Motors, Piaggio may join race for Scooters India

New Delhi, Aug 24

After reports of Mahindra & Mahindra and Atul Auto evincing interest in the purchase of a controlling stake in sick public sector company Scooters India Ltd (SIL), it seems that Tata Motors and Piaggio may also be in the race.

Top officials in the Heavy Industries Ministry told Business Line that Piaggio and Tata Motors have also shown interest in purchasing a 74 per cent stake in the Lucknow-based three-wheeler maker. Meanwhile, the Mahindras and Rajkot-based Atul Auto, have reportedly already spoken to Ministry officials.

Huge potential

“These four companies have already given an indication that they are interested, though the formal Expression of Interest (EoI) can only be made after the Cabinet approval. Many companies see huge potential in SIL because they expect a strong growth from the north Indian and Uttar Pradesh markets,” said the official.

However, when contacted, a Piaggio official said that they had not yet contacted the Ministry, though he expressed hope that the company would be informed when the formal EoI announcement is made. Earlier, in 2000, Piaggio had been interested in purchasing the company but had found the deal to be “not workable”. Tata Motors spokesperson denied the development.

Ministry plans

As part of a turnaround plan for the PSU, the Ministry has proposed divestment of a 74 per cent stake in SIL, whereby it will provide the 150 acre land and equipment. It will also clear the old debts of the sick company, amounting to about Rs 100 crore, while any fresh investment will have to be made by the new private partner.

Ministry officials also said that the fact that 800 people out of the 1,200-strong workforce will retire in the next two years, gives SIL a strong position in its sale. During the last sale attempt in 1996, the union issue was a big problem for the private players.

Sources in the Ministry added that the Cabinet approval is well on the way as the note is getting the final clearances from various departments.

“The sale process will surely happen by end-September,” said the source.

roudra.b@thehindu.co.in

© Copyright 2000 - 2009 The Hindu Business Line

Date:25/08/2010 URL: http://www.thehindubusinessline.com/201 ... 340200.htm
I was told if you stroke it more than twice it's a sin.
Jim C.
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