India's Mahindra & Mahindra group, the world's biggest tractor manufacturer, is the frontrunner in a bidding war to buy a large stake in flashy British sportscar maker Aston Martin, a report said Monday.
Mahindra & Mahindra is likely to pick up a 40-percent stake in the British manufacturer, whose vehicles feature regularly in James Bond movies, for about $190-320 million, The Economic Times reported on Monday.
The newspaper said Mahindra, which makes jeeps along with tractors, is set to pip the other serious bidder, Italian group Investindustrial which owns a stake in motorbike maker Ducati.
"Discussions are still fluid. We are expecting the deal to get closed this week," the report said, quoting an unnamed official with knowledge of the talks.
A 1964 Aston Martin DB5 vehicle used by Sean Connery when he played James Bond, pictured at a photocall in London in 2010. India's Mahindra & Mahindra group, the world's biggest tractor manufacturer, is the frontrunner in a bidding war to buy a large stake in flashy British sportscar maker Aston Martin, a report said Monday.
Mahindra shares saw hectic trading on Monday, hitting their highest level since March 2010 before sliding to 922.15 rupees, down 3.35 percent on growing concerns about the price the Indian group was prepared to pay.
If Mahindra succeeds, it would be second time an Indian company has snapped up a famous name in British motoring in recent years.
Tata Motors bought Jaguar and Land Rover from Ford Motor in 2008 for $2.3 billion and has overseen a revival in the group's fortunes on the back of strong sales in Asia.
Aston Martin, which announced its entry into India in April 2011, expects to sell a quarter of its cars to Asian and Middle Eastern countries in the next five years.
Along with China, India has become a key market for global car manufacturers after growth in Europe and the United States stagnated in recent years.
Luxury car makers including Aston Martin, Lamborghini, Bentley, Jaguar and Porsche already have dealerships in large Indian cities, attracted by the growing numbers of wealthy Indians.
Indian workers assemble a Maxximo mini-truck at the newly-inaugurated Mahindra and Mahindra India plant at Chakan, south-east of Mumbai, 2010. India's Mahindra & Mahindra group, the world's biggest tractor manufacturer, is the frontrunner in a bidding war to buy a large stake in flashy British sportscar maker Aston Martin.
After an initial acquisition of 40 percent, Mahindra is looking at raising its stake to 50 percent in Aston Martin over the next four years, The Economic Times said.
The group is currently owned by Kuwait-based finance firm Investment Dar, which bought it from Ford Motors for $767 million in 2007.
A Mahindra spokeswoman said the group did not comment on speculation.
Analysts say the global economic slowdown has affected Aston Martin's sales, and they questioned the rationale for Mahindra's reported bid.
"I cannot understand the need for Mahindra to buy a super-car maker," an auto analyst with a Mumbai brokerage said, declining to be named.
"After putting in so much money, they are unlikely to get operational control of Aston."