Ashok Leyland increases capacity

Indian commercial automaker Ashok Leyland Ltd. (ALL), part of U.K.-based Hinduja Group, said it will invest more than Rs30 billion (US$696.5 million) over the next three years to expand capacity and upgrade technology. CFO K. Sridharan also said the company plans to publicly list Ashok Leyland Nissan Vehicles Pvt. ALL’s existing shareholders may get equity participation in Ashok Leyland Nissan, with the mechanism for shareholder-inclusion to be decided in the next few months, he said. ALL signed three agreements with Nissan to manufacture and sell light commercial vehicles (LCVs) and power trains and for technology development in India. He added the company has already arranged loans worth US$200 million in the form of external commercial borrowings and intends to raise an additional Rs10 billion (US$232.2 million) over the next two years. The Rs24 billion (US$557.2 million) joint venture between ALL and Nissan is likely to set up a manufacturing facility in the southern Indian city of Chennai and will offer eight product specifications from 2.5 tons to eight tons gross vehicle weight in the next four years, Sridharan said. (June 17, 2008)