Daimler AG, the company that owns Mercedes-Benz, today sold its entire 5.34% stake in India's Tata Motors ending a relationship that stretches back more than five decades.
The German firm said that the sale of 25.6 million shares will generate approximately €300 million (US$401 million) of cash and earnings before interest and taxes, with around €265 million (US$362 million) to be accounted for in the first quarter of 2010.
"Daimler is today in an excellent position to capitalize on the growth potential of the Indian passenger and commercial vehicle markets and continues to intensify its own activities there,", the German automaker said in a statement.
"An equity participation of Daimler in Tata is therefore no longer necessary. This has been done in full consultation with Tata. Relations between the two companies are excellent and will not be adversely affected by this sale," Daimler added.
In addition to its wholly owned subsidiary Mercedes-Benz India that has been producing the firm's cars and commercial vehicles in Pune since 1995, including the E-Class and S-Class models from February 2009, Daimler's Truck division founded its own production company, Daimler India Commercial Vehicles Ltd. (DICV), which is building a new plant in Chennai in the southeast of India.
The company said that starting in 2012, the new plant will initially produce light, medium and heavy-duty commercial vehicles for the Indian volume market under a new brand name.
Car and commercial activities aside, Daimler also established its biggest research and development center outside Germany in Bangalore (pictured below) in 1996.
