ZF Steering Gear India (ZF), a leading supplier of ball and nut integral hydraulic power and worm and roller mechanical steering system, is planning to offload its 26 percent stake in Robert Bosch Automotive Steering (RBASPL), its joint venture with Robert Bosch Automotive, Germany, according to a letter filed by ZF Steering Gear (India) on the stock exchange.
The investment made by ZF Steering Gear (India) in the equity share capital of RBASPL as on March 31, 2019 is Rs 129 crore, that is out of the total paid-up equity share-capital of Rs 497 crore of the company. ZF Steering Gear (India) says RBASPL continuously incurred losses from commencement of its activities, the total accumulated losses of RBASPL, as on March 31, 2019, were Rs 383 crore.
In FY 2018-19, Bosch filed a winding up petition for winding up of RBASPL, before the National Company Law Tribunal (NCLT) Mumbai, which is yet to be heard by NCLT. The company says it has also received a Notice from Robert Bosch terminating the joint venture agreement, dated March 31, 2007, on February 14, 2019.
ZF Steering Gear (India) says considering the accumulated losses and considering uncertainty arising out of above referred winding-up petition and termination of the JV and in order to mitigate further losses, the company (ZF Steering Gear India), as a measure of commercial expediency, decided to enter into an agreement to settle the issues with Robert Bosch and agreed to sell all the said shares of RBASPL to Bosch for a total consideration of Rs 62 crore.