Kolkata-based Hindustan Motors sold its Ambassador brand to French manufacturer Peugot for Rs 80 crore, PTI reported on Friday. The CK Birla group had stopped manufacturing the iconic car in 2014 citing poor demand and debt. The two firms have signed an agreement that surrenders the “brand and certain related rights”, the CK Birla group statement informed the markets.
“Hindustan Motors has executed an agreement with Peugeot SA for the sale of the Ambassador brand, including the trademarks,” the Indian firm’s statement said. The iconic Ambassador, which used to be a status symbol in the country, was modelled on the British Morris Oxford design.
The statement said, “We intend to use the proceeds from the sale in clearing dues of employees, lenders and others,” Business Standard reported.
In January, the firms entered a deal to set up a vehicle and powertrain manufacturing unit in Tamil Nadu with an initial investment of Rs 700 crore, the news agency reported. The agreement set an initial target of 1 lakh vehicles annually followed by a phased increase in production.
Peugeot SA’s presence in India began with the deal it shared with the Premier brand under the joint venture Peugeot PAL India. The deal fell through in 2001. The CK group’s attempts to restore their position in the Indian market was obstructed by the global economic slowdown, PTI reported. Its plans to launch a mid-sized sedan in 2011 failed too.