The Hindu Business Line : Maha Scooters stake sale: Arbitrator to submit report on Aug 15

THE Maharashtra Scooters stake sale issue may soon be resolved with the arbitrator Mr Justice Arvind Sawant expected to deliver his final report on August 15.

According to shareholders who attended the Bajaj Auto annual general meeting on Friday, Mr Rahul Bajaj, Chairman, in his address said all arguments about MSL are to be concluded on July 30 after which a written concluding summary from both the parties — Bajaj Auto and Western Maharashtra Development Corporation (WMDC) — would be called for.

MSL is the country's third largest scooter maker. It was incorporated in 1975 as a joint venture between WMDC and Bajaj Auto Ltd. WMDC holds 27 per cent, while Bajaj Auto holds 24 per cent of MSL. The company manufactures three brands of scooters, which includes Chetak and Super ranges of scooters after sourcing CKD packs from Bajaj Auto. The selling price was pegged at Bajaj Auto level and MSL had to incur additional cost of sales tax on CKD (completely knocked down) packs supplied by Bajaj Auto. As a result, MSL's margins went negative.

Bajaj Auto is ready to buy the 27 per cent stake of WMDC in the company at a mutually acceptable price. The matter is under discussion with WMDC and the Maharashtra Government. Bajaj Auto and WMDC, the joint venture partners in MSL, have shortlisted Crisil, SBI Caps and ICICI Securities to value the State's 27 per cent stake in the company.

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