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Help Honda to end motorcycle joint venture in India: Report
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Honda Motor Co plans to sell its stake in India's top-ranked motorcycle maker, Hero Honda Motors , and instead focus on its wholly owned subsidiary in the country, a news report said on Saturday.

The Japanese automaker may earn some 100 billion yen (1.2 billion dollars) from the sale of its shares in Hero Honda, founded in 1984 with India's Hero Group, the Nikkei business daily said.

Honda and the Hero Group reached a basic accord this week to dissolve their partnership, Nikkei said, adding that they will seek final approval from their respective boards of directors later this month for the breakup.

Honda will sell its entire stake in the motorcycle maker to the Hero Group's founding family and investment funds by as early as March, and will no longer provide technical support to Hero Honda.

Hero Honda sold 4.5 million Honda-brand motorcycles in the previous fiscal year, grabbing 48 percent of the growing Indian motorcycle market, the world's second-largest behind China.

Hero Honda contributes roughly one-third of Honda's worldwide sales, but Honda reckons that it needs to have full control over operations to respond quickly to market changes, Nikkei said.

In future, Honda will focus its resources on wholly owned subsidiary Honda Motorcycle and Scooter India (HMSI), the fourth-biggest motorcycle maker in India, with sales of 1.2 million units.

Honda plans to build a new factory in the southern state of Andhra Pradesh for HMSI, while speeding up its development of new sales outlets, Nikkei said.
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