LML partners, Piaggio of Italy and the Singhanias have resolved to negotiate an out-of-court settlement. This was reported by a leading financial daily.
LML is India's second largest scooter manufacturer with 27% market share (in August 1999). Its brands are recognised for their styling and aesthetics. The Vespa, its flagship brand, is targeted at the premium end of the scooter segment. LML had earlier entered into a technical tie-up with Piaggio, but the relationship between the two partners soured over allegations of breach of agreement.
The two partners have suspended all legal proceedings. These include cases filed in the Supreme Court, the Company Law Board, and the International Chamber of Commerce.
With an out-of-court settlement in the offing, the negotiations are expected to be resolved expeditiously. However, its anybody's guess whether the settlement will affect both parties favourably. The Kanpur court had passed an order in favour of LML, permitting the company to purchase the 23.6% equity stake from Piaggio. But this was disputed by Piaggio, which filed a case with the Supreme Court. It remains to be seen how the out-of-court settlement will be any different from what is already transpired between the two partners.
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