New Delhi : Hero MotoCorp , India’s biggest two-wheeler manufacturer, will spend close to Rs 2,575 crore on two new factories to be operational by the second quarter of the next financial year, the automaker’s managing director Pawan Munjal said. The two new plants will take the company’s total capacity to above 9 million vehicles from 7 million currently.
In addition, the company also approved a proposal to merge the investment arm of its parent into the automaker, the company said in a statement on Monday.
Private equity funds Bain Capital will hold 8.58 percent and the Government of Singapore Investment Corp (GIC) will own 3.71 percent in the automaker through wholly-owned Indian units after the merger, the company said.
The private equity firms’ investments in Hero Investments, a promoter-controlled holding company, were used to help repay debt from the $851 million purchase of former partner Honda Motor’s 26 percent stake in the automaker in March 2011.