Mumbai: Maharashtra Scooters Ltd (MSL) the maker of the once popular Priya brand of scooters, has become a subsidiary of Bajaj Holdings and Investment Ltd (BHIL) following the Western Maharashtra Development Corporations (WMDC) transferring its 27 percent stake in MSL to the company after a protracted legal battle.
Incorporated in June 1975 as a joint venture between then Bajaj Auto Ltd (BAL) and the state-run WMDC Ltd to manufacture of geared scooters in collaboration with erstwhile BAL, it stopped production from April 2006, three-decades after producing the first scooter, amid gradual shift in consumer preferences from geared scooters to the motorcycles.
"WMDC has transferred its 27 percent stake in MSL to the Bajaj Holdings and Investment Ltd (BHIL) on 17 June. With this, the company now holds 51 percent shares in MSL, thereby making it a subsidiary of Bajaj Holdings," the statement said.
MSL at present manufactures pressure die casting dies, jigs and fixtures, primarily meant for two and three-wheeler industry.
According to the statement, WMDC had in 2003 offered to sell its 27 percent shareholding in MSL and Bajaj Holdings & Investment Ltd (BHIL & erstwhile BAL) had confirmed its willingness to purchase these shares. However, since WMDC and Bajaj Auto could not agree on a price at which the shares were to be sold had been jointly referred to a sole arbitrator, Justice Arvind V Savant (retd) said.
The Award of the Arbitrator on 14 January 2006 valued the share price of MSL at Rs 151.63 apiece as the rate at which 3,085,712 equity shares of MSL held by WMDC were to be sold to the company, it said. This was, however, challenged by WMDC in the Bombay High Court. The Division Bench of the Bombay High Court had pronounced its judgment in the matter on 8 May 2015.
A Special Leave Petition (SLP) was then filed by WMDC in the Supreme Court against this order. After hearing both the parties, Supreme Court passed an order on 9 January his year, dismissing the SLP filed by WMDC.
It also directed that BHIL shall pay to WMDC an amount of Rs 232 per share in place of Rs 151.63, along with interest at a rate of 18 percent per annum from the date of the award (i.e. 14 January 2006). No sooner the aforesaid payments due are made, the shares shall be transferred to BHIL.
Subsequently, Bajaj Holdings and Investment made the necessary payment to WMDC by way of cheques on 14 January this year, it added.
Updated Date: Jun 19, 2019 10:40:17 IST