Eicher Motors forays into financial services with Volvo Group, board approves Rs 750-cr investment

New Delhi: on Thursday said its board has approved an of up to Rs 750 crore to subscribe to 50 per cent equity stake in (VFS) India, to form a new equal .

Eicher Motors td (EML) and have an existing joint venture, Volvo Eicher Commercial Vehicles Ltd ().

The proposed new JV will be the arm for VECV, EML, and Volvo Group products in India, the company said in a statement.

“Expanding our highly successful 18-year partnership with Volvo Group, Eicher is now entering the vehicle financing business in India through a new joint-venture. This JV combines Volvo’s global expertise and Eicher’s local knowledge and network,” EML Chairman Siddhartha Lal said.

The JV will serve Eicher, Volvo, and Royal Enfield customers in India and presents an opportunity for EML to operate in an important segment of the value chain, using financing as a lever for a superior , he added.

Globally, Volvo Group offers tailored financial solutions to Volvo’s customers and dealers around the world through Volvo Financial Services (VFS), its captive finance provider.

The statement said the new JV will combine VFS’ strength and understanding in the financial services with Eicher’s expansive product portfolio, network and deep market understanding to capture new business in a more aligned and efficient manner.

The proposed JV will also deepen integration to accelerate decision-making and help customers in easily accessing financing solutions.

Upon closing of the transaction, contingent upon regulatory approvals, fresh equity shares of the proposed JV entity will be issued to EML, it said, adding that the exact investment will be determined at the time of closing, as per the transaction documents.