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Hero Honda Motors Ltd on Friday said, one of its biggest founding companies has pledged a part of its holding to IL&FS Trust Company Ltd as security against the bonds it issued earlier.
Hero Investments Pvt Ltd has pledged about 10.62 million shares in Hero Honda, totalling a 5.32 per cent stake in India's largest two-wheeler maker by sales, Hero Honda said in a statement to the BSE.
The New Delhi-based Hero Group, through 23 affiliates, holds a 26.21 per cent stake in Hero Honda. Hero Investments holds the majority 17.33 per cent of the 26.21 per cent stake held by Hero Group.
Hero Investments didn't disclose the size of the bonds or a time frame for when they were to be issued, but they were likely to be issued as part of the plan of Hero Group to buy out Japan's Honda Motor Co's (HMC) 26 per cent stake in Hero Honda.
Hero Group had in December agreed to buy Honda's 26 per cent stake in the auto maker for an undisclosed amount through two or more group companies.
On Friday, the shares of Hero Honda rose 2.15 per cent to close at Rs 1,534.45 on the BSE.
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