There are reports that LML may resume production soon, while M&M and TAFE are eyeing a stake in Punjab Tractors.

According to reports LML may resume production in two months and will go ahead without any collaboration.

The management has been quoted as saying that it has " large export orders in hand." It has plans to make 10,000 scooters per month and the financing plans are still being worked out.

LML is registered with BIFR; the package is being worked out and vendors are seeking payment of past dues from the BIFR package. LML is reported to have borrowed around Rs 200-250 crore as it has accumulated losses of Rs 300 crore.

There are also reports that M&M and TAFE are eyeing 29-per cent stake in Punjab Tractors. The Burman are likely to follow suit with Actis if the price is right. Actis and Burmans together hold 43-per cent stake in Punjab Tractors.

The acquirer may have to pay a control premium and open offer will be triggered if the deal goes through.

Analysts are concerned over the low market share of Punjab tractors. Three years ago, M&M and TAFE had shown interest but the deal did not fructify due to control concerns.

Punjab Tractors has a strong portfolio in 31-40 hp tractors. TAFE is already a strong player in the segment, while M&M is strengthening its 35-40 hp portfolio and would benefit from distribution and Punjab Tractor brand.