The Hindu Business Line : ITL in talks to offload 10 pc stake

International Tractors Ltd (ITL), manufacturer of the Sonalika brand of tractors, is in an advanced stage of negotiations to offload 10 per cent stake to a private equity firm.

The tractor firm already has strategic investments by three firms, including two private equity firms, which collectively hold 32 per cent in ITL. This includes a 10 per cent stake each by Citigroup and 3i, while Japanese tractor maker Yanmar has about 12 per cent stake in the company.

Source said that Barclays Capital might be one of the firms in the fray for the stake. When contacted, Mr L.D. Mittal, Chairman, ITL, said that the company was in talks with three-four private equity firms. He, however, declined to confirm the names of the private equity firms in fray. "The transaction should be completed in a month's time. We will not be offloading any further equity and are planning to go in for an IPO next year," he added.

ITL had a turnover of Rs 1,000 crore last year and is targeting revenues of Rs 1,400 crore in the current year.

Mr Mittal said that talks were also on to offload about 10 per cent stake in International Cars and Motors Ltd (ICML), another Sonalika Group company, to a strategic investor.

"Currently private equity firms hold about 30 per cent stake in ICML. However this time around we are not looking for purely a financial investor, but a strategic one. We are already speaking to a few foreign automotive firms. We are planning to launch car models and will require a technical partner for the same," Mr Mittal said.

ICML earlier had a technical tie-up with Rover UK and had introduced its first vehicle Rhino, utilising Rover technology. According to Mr Mittal, the Rhino has met with success in the two markets where it was launched, Punjab and Haryana, and will be rolled in all the other Northern States this quarter.

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