M&M will start fresh talks to buy Tractorul

Will send a team to Romania soon

After the failure of talks to buy Tractorul Brasov SA of Romania last week, homegrown Mahindra & Mahindra Ltd (M&M) is set to start fresh negotiations with the Romanian government to acquire the firm.

Anand Mahindra, vice-chairman of the company, had announced that the bid had collapsed after the Romanian government rejected its debt guarantees. The roadblocks are slowly being removed, said sources.

The Romania government has approached M&M again with a fresh proposal regarding the debt issue, they said, adding, a team of M&M officials is likely to fly down to Romania in the next few weeks.

Durgashanker, senior vice-president (mergers and acquisitions), M&M, said, “The acquisition of Tractorul is still in our mind and it’s not failed yet. We will be going for fresh round of talks on different possibilities and will definitely find out a solution soon.”

M&M has urged the Romanian government to write off Tractorul’s past liability of €180 million. “We very much want to acquire the company, but we can’t carry such a huge debt liability, said Uday Y Phadke, president - finance & legal affairs, Mahindra & Mahindra.”

Q3 net up 3%

M&M has posted a 3.52% increase in profit after tax at Rs 241.68 crore for the quarter ended December 31, from Rs 233.45 crore in the corresponding quarter a year ago.

The total income (net of excise) increased 16.45% to Rs 2,617.30 crore (Rs 2,247.45 crore).