The Volvo Group has sold 1,270,000 shares in the listed Indian automotive manufacturer, Eicher Motors, for SEK2.5bn (US$301.03m).
The share sale has no effect on ownership or the development of the longstanding joint venture, VE Commercial Vehicles but the sale will have a positive impact on the Volvo Group’s cash flow after net investments and net financial debt in a corresponding amount in the first quarter of 2015. The sale will also generate a capital gain of approximately SEK2.4bn which will impact operating income in the trucks segment in the first quarter of 2015.
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The share disposal will have no impact on either the ownership or control of the truck and bus manufacturer, VE Commercial Vehicles (VECV) in India, where the Volvo Group will remain as owner. Since 2008, VECV has been owned by Eicher Motors Limited (EML) and the Volvo Group and is currently the third largest manufacturer of commercial vehicles in the Indian market.
