The Hindu Business Line : Motherson Sumi to set up second venture with Woco

The Chairman of the Sumi Motherson group, Mr V.C. Sehgal, told Business Line that the joint venture company would set up its plant at Kandla special economic zone for assembly and manufacture of components for the automobile and irrigation sectors.

He, however, declined to give details about the group's proposed acquisition in Europe but said that, "it makes sound business sense for Indian business houses to acquire companies abroad and then outsource its work back home to other group companies, a sort of reverse outsourcing."

The proposed company — Woco Motherson Advanced Rubber Technologies Ltd — would be a 49.99:50.01 joint venture with the domestic partner holding a marginal majority to start with.

However, Woco would also subscribe to convertible preference shares of the joint venture company which after conversion would together account for a 66.67 per cent stake in the company while the stake held by Motherson Sumi Systems Ltd would come down to 33.33 per cent, he said.

Mr Sehgal said that of special types of rubber moulded automotive components, rubber to metal parts and rubber to plastic parts would be manufactured by the new joint venture company and would primarily cater to the export markets, particularly China and European countries.

Mr Sehgal said that works for the plant would begin in April 2005 and the company expects to have a turnover of around Rs 60 crore in the first full year of commercial operations. Eventually, the target is to have a turnover of around Rs 150 crore annually over a period of two to three years.

The group, which had notched up a turnover of around Rs 1,100 crore in 2003-04, is expecting record growth during the current financial year and hopes to end the fiscal with a turnover of around Rs 1,500 crore, he said.

More Stories on : Alliances & Joint Ventures | Automobile Components

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Mukesh clarifies on `ownership issues'

Ranbaxy launches new drug for urological disorder

Deccan Chronicle plans launch in TN by Feb `05

ABB to invest $100 m in India

Reliance keen on bringing gas to Bengal from K-G find

BHEL bags Rs 26-cr orders

ICAI disclosure norms for court-ordered accounts

Ford India sales income up 29 pc; net loss pared

To fund capacity expansion — Bajaj Hind mulls Rs 100-cr equity infusion

Talks on Bajarang Jute mill reopening

Deccan Gold signs exploration pact with De Beers

DS Group plans jt venture with Lotte for confectionery biz

Motherson Sumi to set up second venture with Woco

Eicher eyes Rs 2,000-cr turnover this fiscal

MPI to invest Rs 10 cr to double capacity

The meeting that never was

Rupee options a hit among corporates