Rs 153 Crore Acquisition of Norton Motorcycles by TVS Motors Amid the Covid 19 Economic Slump

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Rs 153 Crore Acquisition of Norton Motorcycles by TVS Motors Amid the Covid 19 Economic Slump

Giant acquisition by TVS Motors

Tuesday, 21st April 2020


Indian two and three wheeler manufacturing giant TVS Motor Company has made a landmark acquisition of the UK based archetypal motorcycle company, Norton Motorcycles for Rs 153 crore (16 million Pounds). More than a hundred years old, Norton Motorcycles has been known to manufacture a range of classic British two-wheeler models such as V4 RR, Dominator, Commando 961 Cafe Racer MK II and Commando 961 Sport MK II.

 

This was an all-cash deal that was concluded by yet another acquired company of TVS Motor’s subsidiary, TVS Motor (Singapore) Pte. Ltd. Project 303 Bidco Ltd was acquired and incorporated just prior to the momentous transaction with the iconic British brand.

 

In his comments on the acquisition, joint managing director of TVS Motor Company, Sudarshan Venu pointed out the immense opportunities that this deal was going to present them with in terms of catering to a niche and discerning clientele.

 

He went on to append that Norton would continue to hold on to its individual identity along with its specific business plans. TVS will work in close coordination with their employees and customers in order to restore and take their successes to greater heights in the global market. In addition, TVS Motors too will have a synergetic effect and leverage from the British company’s reach worldwide.

 

Founded in Birmingham, England in the year 1898 by James Lansdowne, Norton Motorcycles has reportedly been under financial duress of late, with insufficient cash flow leading to troubles in fulfilling orders. Reports also stated that the company went into administration (equivalent to insolvency in India) earlier this year. The previous owner of the company was also said to have been under investigation and legal action over tax discrepancies, undelivered motorcycles and mismanagement of pension schemes.

 

This is despite the fact that their limited-edition model, V4 SS is extremely fast selling and that too for a whopping GBP 44,000 asking rate. The company’s factory at Donington Hall was facing difficulties with funding required to source the special parts for manufacturing these high-end vehicles.

 

Big names such as Rothschild and Co, and Khaitan & Co helped in the undertaking of the deal with financial advice from the former and legal advice for the transaction from the latter along with the renowned Slaughter and May.

 

Source: India Today


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