Mitsubishi will no longer be on co's board: Eicher Motors

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Mitsubishi will no longer be on co's board: Eicher Motors

Eicher Motors' promoters have purchased Mitsubishi's 3.18% stake in the company. In an exclusive interview with CNBC-TV18, Siddharth Lal, Chief Executive Officer, Eicher Motors, discusses the reason behind the transaction and his outlook for the sector and the company.

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Eicher Motors ' promoters have purchased Mitsubishi's 3.18% stake in the company. In an exclusive interview with CNBC-TV18, Siddharth Lal, Chief Executive Officer, Eicher Motors, discusses the reason behind the transaction and his outlook for the sector and the company.

Here is a verbatim transcript of an exclusive interview with Siddharth Lal on CNBC-TV18. Also watch the accompanying video.

Q: Walk us through how you are seeing the pickup at the moment and do you see that momentum continuing?

A: Certainly, we see the momentum reasonably good now because there is a lot of spend on infrastructure and the progress in the commercial vehicle (CV) industry is now picking up. So, yes we see the trend continuing in the next few months.

Q: The deal that's just done - the 4% that you have bought from Mitsubishi, does this mean that any other relationships that you may have with Mitsubishi now ends or is it just business as usual and this is only a financial transaction?

A: Mitsubishi Motors, till recently was holding 3.18% stake in our company and that was mainly a result of what was an erstwhile partnership in Eicher Motors. For more than ten years we have not had any relationship with Mitsubishi except they continue to hold the stake, so they weren't the part of the board or they had no other technical instrument or anything. So, they were looking at selling the share, so we agreed to purchase them and the promoters of Eicher Motors have purchased these shares from them. So, of course now there is no more relationship with Mitsubishi at all and they will no longer be listed as a promoter in Eicher Motors.   

Q: At this moment would you look at perhaps sharing some of this to either a strategic partner or do a QIP or a follow-on offering and perhaps dilute a bit of your stake or there is no such plan in the pipeline as we speak?

A: There is absolutely no such plan. We have consolidated our holding at the promoter level to close to 56% and we already have a strategic partner in our CV business which is Volvo and they also have hold around 8% in Eicher Motors. Eicher Motors have around Rs 400 crore of cash, so we do not need any further cash infusion or injection at this point, so there is no need to get any more cash or partner in Eicher Motors.