Mumbai, September 25: Mahindra & Mahindra Ltd is planning to up its stake in Swaraj Engines by buying out Kirloskar Oil Engines’ stake in the latter, a financial daily reported on Friday.
Swaraj Engines was formed in technical collaboration with Kirloskar Oil, which currently holds 17.39 percent stake in the firm.
Mahindra & Mahindra, India’s top tractor maker, has a 33.2 percent stake in Swaraj Engines and is planning to consolidate its stake in the firm to expand the diesel engines business, the paper said quoting bankers familiar with the development.
“M&M has a bigger plan for the engine business and this acquisition would help the group leverage Swaraj Engines for that,” the paper quoted an investment banker familiar with the development.
“M&M has already had talks with Kirloskar Oil and the deal is most likely to happen,” the banker told the paper.
A spokesperson for Mahindra & Mahindra declined to comment when contacted.
Kirloskar Oil Engines could not be reached for comment.
Another banker familiar with the matter told the paper the sale of stake by Kirloskar Oil would help it focus on its own business.
–Agencies