New Delhi: There is a buzz in the market that M&M is doing due diligence for LML's bike plant. Sources have told CNBC-TV18 that M&M may be looking at buying out or taking a major stake in LML.
This is being attributed to M&M's intention of entering the two-wheeler segment. Sources also say that M&M is in talks with a Chinese two-wheeler company - Lifan for the same reason.
However, analysts say that LML's bike plant's capacity is 30,000 units per month. They do not think that LML will be able to command a very good price, as it has huge accumulated losses.
The company's manufacturing capabilities in terms of quality are good, but it is not rated very high, they say.
Earlier Mahindra Motors said that it considers South Africa as one of its most important market outside India and would set up a manufacturing unit as soon as its sales crosses 1,000 units a month.
Mahindra, which together with Tata Motors is making inroads into the South African market because of its reasonably-priced vehicles, would also use South Africa as a gateway to the rest of the African continent.
Mahindra had recently entered into a joint venture with Renault in terms of which it would be the first right-hand drive manufacturer of its low-cost Logan car.
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