The Hindu Business Line : Federal Mogul to support Talbros in making gaskets till 2013

New Delhi, Nov. 25 Federal Mogul Corporation’s proposal to set up a new subsidiary to manufacture sealing products and gaskets, which had been rejected by the Foreign Investment Promotion Board following objections by Talbro, is now on board. The two parties have resolved their differences.

According to a statement issued by Talbros Automotive Components Ltd (TACL) to the Bombay Stock Exchange, Federal Mogul will continue to support it in the development and manufacture of all the non-asbestos gaskets covered under the existing technical assistance agreement, which is valid till 2013. Federal-Mogul, however, is free to manufacture and distribute dynamic seals and multi-layer steel (MLS) gaskets in India as it does not violate the technical agreement. Similarly, Talbros would also be able to make multi layer steel gaskets under a separate agreement with Nippon Leakless Corporation, Japan.

Earlier TACL had inked an agreement with Federal Mogul’s affiliate company in the UK, under which it obtained a non-exclusive licence from the latter on know-how pertaining to manufacture of non-asbestos gaskets in India. TACL had cited Press Note 1 to FIPB stating that the Federal Mogul’s move to set up a subsidiary company would severely impact its operations.

Federal Mogul, a global supplier of automotive components and other engineering products, had sought Government approval to set-up a new wholly-owned subsidiary with a 100 per cent foreign equity, entailing an investment of up to Rs 60 crore over a three-year period.

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