Motherson Sumi Systems, one of the largest and most diversified automotive supplier groups in India, is setting up its second joint venture with the Woco group – this one will manufacture rubber parts for the automotive and irrigation sectors.
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The new company – Woco Motherson Advanced Rubber Technologies Ltd – will be a 49.99%/50.01% joint venture with Motherson Sumi holding a marginal majority at the start. However, the German partner will increase its stake in future to 66.67% by subscribing to convertible preference shares.
The new joint venture company will set up its plant in the Kandla Special Economic Zone (SEZ) to manufacture and assemble special types of rubber moulded automotive components, rubber to metal parts and rubber to plastic parts.
Work on the plant will begin in April 2005 and the company expects to reach a turnover of INR600 million in the first full year of operation. The eventual target is a turnover of around INR1.5 billion annually within two to three years.
The Motherson Sumi group is also in the final stages of buying a bankrupt company in Europe but details are not yet released.
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By GlobalDataDeepesh Rathore / Tilak Swarup
