Mahindra & Mahindra Ltd has agreed to acquire a stake in Finland-based harvester maker Sampo Rosenlew Oy, as India’s biggest tractor maker looks to diversify its farm equipment business.
The Indian company will purchase up to 35 per cent of Sampo Rosenlew Oy for not more than €18 million ($20.5 million or about Rs 135 crore) in cash, it said in a stock-exchange filing on Thursday.
“We are now putting in place a strategy to build a full product line of farm equipment that goes beyond tractors and with this we will compete globally in both advanced and developing markets,” said Pawan Goenka, executive director at M&M.
Rajesh Jejurikar, president and CEO at M&M’s farm equipment and two-wheeler business, said Sampo Rosenlew will enable Mahindra to grow in the global combine harvester business. “The two companies will work closely towards taking Sampo’s combine harvesters to new markets globally, including India.”
Sampo Rosenlew also plans to develop a new range of combine harvesters for developing markets and for specialty crops, M&M said.
The Finnish firm was set up in 1853 and also makes forestry machinery. It had standalone revenue of €93 million in 2014-15. It also has a joint venture in Algeria to make combine harvesters which had revenue of €45 million for the same year.
The deal is subject to customary adjustments and approvals from anti-trust bodies and other regulators. It is likely to close by the end of June.
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