Swedish giant Volvo bought into Eicher Motors Ltd (EML) and would invest $350 million in a new subsidiary that the two companies would set up.
Volvo and Eicher signed a Letter of Intent on Monday for a joint venture, with an enterprise value of $506 million, that will be a step-down company of EML. Eicher will transfer its commercial vehicles, components and engineering design services business to the new joint venture.
Meanwhile, Shares of Eicher Motors fell sharply on Monday soon after it announced a joint venture with AB Volvo as a step-down subsidiary. The share closed at Rs 477.30, down 12.49 per cent or Rs 68.15. It touched a 52-week high of Rs 599 before the announcement was made. The low for the day was Rs 442.30. Traded volume was 10,52,119 shares.
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