The country's leading two-wheeler maker Hero group said on Saturday that it will raise Rs 3,650 crore by selling a 29 per cent stake in Hero Investments Pvt Ltd (HIPL) to two private equity firms. HIPL is a promoter firm of India’s largest two-wheeler maker Hero Honda. The group has already signed the definitive agreements with two private equity firms including Lathe Investment Pvt Ltd (a wholly-owned subsidiary of Government of Singapore Investment Corporation and BC India Private Investors II (an affiliate of Bain Capital LLC).
According to a recent statement given by a senior Hero Group official to media, "Subject to all necessary clearances, these two investors shall collectively invest around Rs 3,650 crore for approximately 29 per cent stake in HIPL, which will own 43.33 per cent of Hero Honda Motors Ltd post acquisition of Honda's stake."
The proposal will now be recommended to the Cabinet Committee for approval by the Foreign Investment Promotion Board (FIPB), as the deal involves foreign investment exceeding Rs 1,200 crore. Earlier, the BM Munjal-led Hero Group had agreed to buy Honda's 26 per cent stake in their joint venture Hero Honda for Rs 3,841.83 crore.
