Chennai, March 4 (IANS): European truck maker AB Volvo on Wednesday sold 4.7 percent stake in Eicher Motors Ltd for around $310 million, an Eicher Motors official said.

"Volvo has sold 4.7 percent stake (12.7 lakh shares) in Eicher Motors for around $310 million," a spokesperson of Eicher Motors told IANS over phone from New Delhi.

However, she said she was not aware whether the promoters of Eicher Motors were offered the right of refusal for the stake before off-loading in the market Wednesday.

According to her, it was a portfolio investment for Volvo in the Indian company.

Normally, shareholders agreements would provide for right of first refusal to the joint venture partners, when one of them decides to exit the venture.

In this case, though Volvo is not a joint venture partner in Eicher Motors, it is not known whether there was any such agreement between the two parties given their strategic association.

According to Eicher Motors, the divestment by Volvo will have no bearing on the truck making joint venture VE Commercial Vehicles Ltd (VECV).

The European company acquired 45.6 percent stake in VECV.

In addition Volvo had also acquired 22.75 lakh shares of Eicher Motors representing 8.4 percent of equity capital of the company.

It is out of this 22.75 lakh shares that Volvo divested 12.7 lakh shares approximately 4.7 percent stake in Eicher Motors.

"This divestment will have no bearing whatsoever on VECV, which will continue to be governed as an equal partnership venture. The shareholding pattern and governance framework of VECV remains unchanged," Eicher Motors said in a statement.

"Both partners - Eicher Motors Limited and AB Volvo - are equally committed to grow the business together. Since its formation, VECV has been growing from strength to strength, outpacing the industry across various segments and gaining market share with breakthrough products and a lean business model," the statement added.