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Chennai, March 12 TVS Motor Company has converted a loan of Rs 18.50 crore that it gave to its wholly-owned subsidiary, Sundaram Auto Components Ltd, last year, into equity.

TVS Motor announced to the stock exchanges that it would get 37 lakh equity shares in SACL at Rs 50 a share. Upon enquiry, it was learnt that TVS Motor is making no fresh investment; it is only a conversion of last year’s loan into equity.

Sources said that SACL, which produces plastic and rubber components for automobiles, has also been hit by the slowdown and would find payment of interest difficult. Even if it could pay, the interest turns up as income in TVS Motor’s books, giving rise to an incidence of tax.

TVS Motor also announced that Mr R. Ramakrishnan has joined the company’s board of directors as a non-executive member of the board, filling a vacancy caused by the resignation of Mr Gopal Srinivasan.

Mr Ramakrishnan was earlier a dealer of TVS Motor Company. He is on the board of PT TVS Motor Company Indonesia, TVS Motor’s arm in Indonesia.

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