After a successful venture in India, and as a consequence of its refreshed business strategy, Marcopolo S.A. has decided to exit from its joint venture with Tata Motors and has offered to sell its 49% shareholding in Tata Marcopolo Motors Ltd. (TMML) to its partner. TMML is a 51:49 JV formed in 2006 between Tata Motors and Marcopolo S.A., one of the largest bus and coach manufacturers globally. Since its incorporation, the JV has introduced several innovative designs and concepts helping redefine the premium bus body segment in India. TMML has manufacturing facilities in Dharwad and Lucknow where it builds bus bodies on chassis supplied by Tata Motors and marketed under the “Starbus” and “Starbus Ultra” bus brands.
Tata Motors and Marcopolo have entered into a share purchase agreement where the former will purchase the balance 49% shareholding in TMML for a cash consideration of INR 99.96 crore. Post the purchase, TMML will become a wholly-owned subsidiary of Tata Motors. All technologies pertaining to existing bus body products manufactured will continue to vest with TMML. In addition as part of the transition, Marcopolo will continue to license the “Marcopolo” trademarks to TMML for a minimum of 3 years with a non-compete provision in India for a corresponding period. The transaction will not result in any impact on TMML’s operations or the continued sales and service of Tata Motors’ customers. Tata Motors, Marcopolo and TMML intend to maintain an open channel for future collaboration opportunities around bus body designs and technical consulting services.