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Tuesday, Aug 31, 2004

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BPL ends marketing pact with German major Loewe

Boby Kurian

Bangalore , Aug. 30

BPL Ltd has said that its arrangement with German consumer electronics and multimedia major, Loewe AG, for marketing and distributing high-end colour televisions (CTVs) and video display solutions in the country is no more in place. BPL had entered into pact with the DM 7-billion German company in 2001 and had then predicted that the relationship could go deeper in the future.

"The agreement with Loewe has expired," Mr Ajit Nambiar, Chairman & Managing Director of BPL Ltd, said. Last month, BPL hived off its CTV business into a 50:50 joint venture with Japan's Sanyo for $80 million and has since then announced plans to co-brand with the foreign equity partner. However, the company's OEM supplies to Chinese brand Haier will continue, Mr Nambiar added. Haier, touted as the world's second largest consumer durables operations, entered India last year and had identified BPL as one of the vendors for sourcing CTVs.

BPL's discontinued pact with the German giant had envisaged marketing and distributing top-of-the-line digital televisions under BPL-Loewe brand. It targeted the premium end of the market pegged above Rs 80,000 and talked about opening exclusive galleries in Delhi, Mumbai and Bangalore to promote Loewe products. Loewe also had entered into negotiatons looking at sourcing components and lower-end TVs from BPL's plant in Slovenia. Further, the German company had plans to collaborate with BPL to develop software for is multimedia products. The arrangement with Loewe had made modest beginnings before it got bogged down under BPL's debt restructuring and equity sale exercise.

Meanwhile, BPL, the one-time leader in the domestic CTV business, is charting a fresh strategy along with Sanyo to regain the top slot in the next three years. BPL, which had scaled down its production and marketing, claims that it has managed to hold on to the key dealers despite being on the backfoot in recent years. "We have managed to hold on to 16,000 odd key CTV dealerships across the country. It shows loyalty to the brand and the latent equity it commands in the marketplace," a source said.

It is learnt that BPL sans all marketing push still manages to sell over 40,000 units of CTVs monthly.

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