Marcopolo SA exits from the bus joint venture with Tata Motors
2020 took its latest casualty in the auto industry: the joint venture Tata Marcopolo Motors Limited. Yes, Tata Motors has announced that it will now buy Marcopolo’s stake in this joint venture that builds and sells buses under the umbrella of the Starbus and Starbus Ultra brands. So what will happen is that Tata Motors will buy Marcopolo SA’s stake in the JV for ₹ 99.96 crore. Once the purchase is made, Tata Motors will become the sole owner of the joint venture Tata Marcopolo Motors Limited. Now, if you are wondering the reason for the decision, Tata Motors has explained that it is the result of the new business strategy of Marcopolo SA.
A little background on this joint venture, of course: Tata Motors and Marcopolo SA, one of the largest bus and coach manufacturers in the world, formed this 51:49 joint venture in 2006. Since then, a myriad of projects and concepts for the award The bodywork segment was launched by this joint venture in India. TMML has manufacturing facilities in Dharwad, Karnataka and Lucknow where it produces bus bodies supported by chassis supplied by Tata. As mentioned above, these buses are retailed under the Starbus and Starbus Ultra bus brands in the country.
In a press statement announcing the decision, Tata Motors said: “The Company and Marcopolo SA have entered into a share purchase agreement in which the Company will purchase the balance of 49% of the stake in TMML for cash consideration. of INR 99.96 crore. purchase, TMML will become a wholly owned subsidiary of the Company. All technologies related to existing bus body products manufactured will continue to be entrusted to TMML. In addition, as part of the transition, Marcopolo SA will continue to grant licenses the “Marcopolo” trademarks to TMML for a minimum of 3 years with a non-compete provision in India for a corresponding period.The transaction will have no impact on TMML’s operations or the continuing sales and services of the Company’s customers. The Company, Marcopolo SA and TMML intend to keep an open channel for future collaboration opportunities on bodywork projects and technical consulting services “.