LML to resume production; M&M, TAFE eye stake in Punjab Tractors: CNBC-TV18

27 December 2006

There are reports that LML may resume production soon, while M&M and TAFE are eyeing a stake in Punjab Tractors.

According to reports LML may resume production in two months and will go ahead without any collaboration.

The management has been quoted as saying that it has " large export orders in hand." It has plans to make 10,000 scooters per month and the financing plans are still being worked out.

LML is registered with BIFR; the package is being worked out and vendors are seeking payment of past dues from the BIFR package. LML is reported to have borrowed around Rs 200-250 crore as it has accumulated losses of Rs 300 crore.

There are also reports that M&M and TAFE are eyeing 29-per cent stake in Punjab Tractors. The Burman are likely to follow suit with Actis if the price is right. Actis and Burmans together hold 43-per cent stake in Punjab Tractors.

The acquirer may have to pay a control premium and open offer will be triggered if the deal goes through.