New Delhi, Sept. 2: Mahindra & Mahindra (M&M) today said it has submitted financial bid worth nearly Rs 1,500 crore for acquisition of Brazilian tractor maker Valtra.
Industry sources said Mahindras were willing to pay up to Rs 1,500 crore for the deal which would see them take over tractor plants in Brazil and Finland. “The process is on and we have submitted the bids on August 29,” said managing director Anand Mahindra. But he refused to divulge further details citing non-disclosure norms.
Asked for the reason behind the firm bidding for Valtra and not for Punjab Tractors Ltd (PTL) Mahindra said: “Valtra is a global company and Mahindra’s vision is to go global.”
PTL was recently sold off by the Punjab government as part of the state government’s disinvestment drive. “We did our own valuation and after checking the documents we came to our own perception and decided not to bid,” Mahindra said.
Valtra, manufacturer of high-end tractors, is the largest tractor maker in the Scandinavian region and the third largest in the Latin American market and has production facilities in Finland and Brazil. Analysts also said the acquisition of Valtra would give M&M’s tractor business a competitive edge.
Mahindra also said the auto-maker expects better retail sales in the coming months driven by ‘good’ monsoon but refused to project sales volumes.
“There is a lag between monsoon and sales figures but we are tracking how the monsoon spans out and then we would take a call,” he said. Mahindra also said the company would soon launch its sports utility vehicle “Scorpio” in Italy followed by China.
The automaker, which first launched the Scorpio in June 2002, is in talks with potential Chinese partners to form a joint venture to set up a production base in China. The Scorpio will be exported to the European countries as a fully-built unit.