M&M to buy 33 per cent stake in Mitsubishi Heavy's farm machinery unit

Vehicle maker Mahindra and Mahindra said on Thursday it would buy a 33 per cent voting stake in the agricultural machinery-making unit of Mitsubishi Heavy Industries for $25 million.

The investment is being made through the issue of common shares and class A non-voting shares of Japan's Mitsubishi Agricultural Machinery, and the deal is expected to close by October 1, the companies said in a joint statement.

Mitsubishi Agricultural makes farm equipment such as tractors, power tillers, rice planters and combine harvesters for sale globally. It brought in about $408 million in revenue for the fiscal year 2015.

Mahindra, which is the world's largest maker of tractors by volume, said the deal would help both companies cut cost and improve their supply chain.

(Reuters)