Commercial Vehicle major Ashok Leyland Ltd has increased its stake in its loss-making UK subsidiary Optare Plc by 23.20% to 98.31%.
The UK arm is one of the leading manufacturers of single-decker, double-decker buses and electric buses for Britain and other markets.
In 2010, as part of its plan to become one of the top 10 global bus manufacturers, ALL has entered into an agreement with Optare to acquire 26% stake for a consideration of $7.5 million. Then in phases, it has increased its stake to 75.11% over the years.
ALL has said that Optare would help the company to access technology including a modern range of mid-size and full-size city buses which can appeal to both domestic and global markets.
The conversion would help to strengthen the balance sheet of Optare while ALL would consolidate its holding in the UK firm, said the company.
"The conversion of loans into the equity has no impact on profits and cashflows for the current financial year of Ashok Leyland as the investments in the equity shares and the loans given to Optare was fully impaired as of March, 2017," said the company.
Optare manufacturer single-decker, double-decker buses and electric buses for the UK and other export markets.
Optare reported a revenue of £35 million in FY17 and loss of £15.7 million as against revenue of £38.3 million and £9.3 million loss in FY16.