Abstract

The case traces the various developments from the time the joint venture took place till the breakup in 2000. In 1995, Escorts and Yamaha Motors formed a 50:50 joint venture (EYML). From 1995 to early 2000, EYML took several steps to become the number one player in India's two-wheeler market. However, in mid 2000, Escorts divested 24% equity to Yamaha Motors and as a result, Yamaha Motors became a majority stakeholder in the venture (74:26). In May 2001, Escorts sold its remaining 26% equity, thus, exiting from the joint venture.

Learning Objectives

The case is structured to achieve the following Learning Objectives:

• Diversification into unrelated businesses
• problems in joint ventures.

Keywords

Escorts, Yamaha Motors, 50:50, EYML, 24%, equity, 74:26, May 2001,26%, Business Environment