Mahindra, the diversified Indian business group with interests in automobiles, information technology and financial services, on Wednesday announced the formation of a Brazilian subsidiary that will eventually acquire a tractor distributing firm in the country.
In a regulatory filing to the Bombay Stock Exchange (BSE), the company said that it has incorporated CMN Solutions Q013 Participacoes Ltd, along with its wholly-owned subsidiary, Mahindra Overseas Investment Company (Mauritius).
The two companies will buy 100 percent stake in CMN Solutions to enable it to buy tractor distribution firm Bramont Montadora Industrial e Commercial de Veiculos S.A. (Bramont) in the company. Bramont is a shell company and has no operations as of now, Mahindra said.
The cost of acquisition won't exceed $8 million for Mahindra, according to the regulatory filing, which also said that the cash consideration will be paid upon approval by the Reserve Bank of India.
Mahindra sold 2.14 lakh tractors in financial year 2015-16 and 12,327 in August this year.
Mahindra shares ended at Rs. 1,407.50 apiece, down 0.16 percent from their previous close.
For the quarter ended June 30, 2016, Mahindra posted 12.4 percent rise in net profit to Rs 955 crore on sales of Rs 11,800 crore.