Mumbai: Hero Honda Motors today said it has executed a final binding licensing agreement with Japan's Honda Motor Company. The agreement paves the way for the Japanese company to exit Hero Honda Motors, its joint venture (JV) with the Munjals-promoted Hero Group, reports PTI.
The agreement pertains to the existing and new products that Hero Honda Motors will offer in the Indian market once the sale of the Japanese firm's stake to Hero Group is concluded.
Hero Honda is a 26-year-old JV between the Hero Group and Honda Motor Co, with each partner holding a 26% stake. As per their agreement, the Hero Group will buy Honda Motor's 26% stake in Hero Honda.
The licensing agreement, which was executed last week, is in line with the memorandum of understanding (MoU) approved by their respective boards of directors on 16 December 2010, Hero Honda Motors said in a filing to the Bombay Stock Exchange (BSE).
Meanwhile, shares of Hero Honda were trading at Rs1,746.50 on the BSE, down 0.54% from the previous close, in early trade today.