Larsen & Toubro, one of the country's biggest conglomerates, today announced that it will sell its entire stake in L&T Kobelco Machinery (LTKM) for around Rs 43.5 crore.

The JV was established in November 2010, with a capital of Rs 50 crore (900 million yen), wherein 51 percent shares were owned by Larsen & Toubro and 49 percent by Kobe Steel. The company's product portfolio includes tyre and rubber machinery for production of tyres for automobiles and construction equipment. The company foresaw an increase in demand due to rising production of automobiles mainly in emerging countries, and planned to market its products in India, Europe, the Middle East, Africa, Russia and Eastern Europe.

According to today's announcement, L&T has entered into a definitive agreement with Kobe Steel, on April 2, 2019 for the divestment of its entire stake in L&T Kobelco Machinery. In FY2018, the JV reported revenue of Rs 82.03 crore, which constituted around 0.07 percent of the consolidated total income for L&T in the financial year. As of March 2018, LTKM reported a net worth of Rs 40.13 crore, of which L&T says its 51 share was valued at Rs 20.47 crore.

L&T says that subject to customary closing conditions, the sale of shares is expected to be completed before the end of April, 2019.