Japanese auto major Honda Motor Company has officially declared that it will sell its stake of its Indian 2-wheeler JV with Hero Motors.
Both Hero Motors and Honda have agreed to and signed MOUs for a new relationship. Following the signing of the MOUs, a joint press conference was held in New Delhi, with Mr. Brijmohan Lall Munjal, the Chairman of Hero Honda, Mr. Pawan Munjal, the Managing Director and CEO of Hero Honda; Mr. Sunil Kant Munjal who represented the partners; and Mr. Fumihiko Ike, Managing Director and Chief Operating Officer for Regional Operations (Asia & Oceania) of Honda.
Based on the consent established by the MOUs, Honda will sell all of the Hero Honda shares it currently holds, which is 26% of Hero Honda’s outstanding shares, to the partners. Honda and Hero Honda will sign a new licensing agreement which enables Hero Honda to continue producing, selling and servicing its current products. Hero Honda will change the company name. The brand name will gradually be shifted from the current ‘Hero Honda’ to the new name. Honda will also grant new licenses for new products which will be produced and sold under the new brand name.
Hero Honda was established in 1984 with a 26% investment by Honda and 26% investment by the partners with the purpose of developing the motorcycle market in India, and started operations in 1985. The company is known for its popular models like the CD100, Splendor, Passion and Karizma.