Escorts Promoter's Buy Additional 4% From Reliance Asset Mgmt
Nanda family - the promoter group of Escorts Group have bought additional 4% stake in the company from Reliance Asset Management for R32Cr through a bulk deal on BSE. The promoters bought 4.2mn shares for R76 per share.
This deal takes the promoter group holding to 31.67% from 27.67%. Reliance Asset Management's stake in the company has come down to 4%.
Escorts Limited was incorporated as Escorts (Agents) Pvt Ltd in Lahore in 1944. It started off by manufacturing tractors under the Escorts brand name in the 25-40 horsepower range. In 1969, It promoted Escorts Tractors Limited as a JV with Ford Motor Company for the manufacture of Ford Series of tractors in the 40-50 HP range. Escorts acquired the entire equity stake of Escorts Tractors in August 1995.
Over the years, Escorts diversified into other products to emerge as a multi-business entity with interests in agri-machinery, automotive components, railway equipment, industrial and construction equipment, and telecom equipment and services. Till 1993-94, all these activities were carried out by the various divisions of Escorts Ltd.
Escorts, after facing a cash crunch, decided to focus only on core businesses viz., Agri-Machinery and Construction Equipment and divested its non-core businesses viz., Telecom business in 2004, Healthcare in 2005, Software business in 2006 and its stake in JV with Carraro in 2006.
At present, Escorts is primarily a manufacturer of tractors (besides auto suspension components and railway equipment) and a holding company for various subsidiary/ JV companies of the Escorts Group. It’s manufacturing facilities are spread across four locations in Faridabad and a facility at Rudrapur.
Escorts on BSE
According to BS, it was also one of the fist Indian companies to to face the threat of a hostile takeover bid by Lord Swaraj Paul in 1983, much before the economy was liberalised. However, that bid was thwarted by the Nanda family, citing rules governing non-resident Indians.
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