Hero to buy Honda stake for Rs 740 per share

The Hero Group, owned by New Delhi-based Munjal family, will pay 3,833 crore to acquire a 26% stake from its 27-year-old Japanese joint venture partner Honda Motor Co in the two-wheeler major Hero Honda.

The transaction was completed for a valuation of 739.97 per share - at less than half of the Tuesday's closing price of 1,518.15 on the Bombay Stock Exchange (BSE).

The Hero Group said in a release that it was acquiring the entire 26% stake of Honda Motor Co in their joint-venture Hero Honda Motors Ltd at 739.97 per share.

The Hero group has also signed definitive agreements with two private equity firms, Bain Capital and Government of Singapore Investment Corporation (GIC) to raise around 3,700 crore through issue of fresh share of Hero Investment Private Ltd (HIPL). HIPL is promoter's investment company that will acquire Honda Motor's 26% stake in Hero Honda. It also owns 17.33% stake in Hero Honda.