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Volvo forms joint venture with India’s Eicher

Swedish truck maker AB Volvo Monday said it will invest about $312 million in forming a joint venture with Indian vehicle manufacturer Eicher Motors.
/ Source: The Associated Press

Swedish truck maker AB Volvo Monday said it will invest about $312 million in forming a joint venture with Indian vehicle manufacturer Eicher Motors.

The company said the joint venture will include Eicher Motors entire truck and bus operations and Volvo's Indian truck sales operations and service network for trucks and buses.

The proposed name for the business is VE Commercial Vehicles Ltd.

The Eicher Motors operations that are included in the deal had sales of around

Volvo forms joint venture with India’s Eicher

$559 million in the fiscal year ended March 31. Operating profit for the period came to $22.9 million.

Volvo said it will have direct ownership of 45.6 percent in the joint-venture. It will also acquire 8.1 percent of Eicher Motors, resulting in a direct and indirect ownership of 50 percent in VE Commercial Vehicles.

Volvo said it aims to complete the transaction, which is pending regulatory approval, in the third quarter.