Tata Motors, Hitachi, Telcon Sign new agreement
By Our Corporate Bureau | 09 Dec 2005
Tata Motors Ltd and Hitachi Construction Machinery Company Ltd (HCM) have signed an agreement to enable HCM to increase its stake in their JV company, Telco Construction Equipment Company Ltd (Telcon), from 20 per cent to 40 per cent.
The agreement was signed by R N Tata, chairman, Tata Motors, S Dazai, president and CEO of HCM and J K Setna, chairman, Telcon.
Telcon is an 80:20 JV between Tata Motors and HCM. With the new agreement, the Tata Motors stake in Telcon would reduce to 60 per cent, the company said in a statement.
The financial terms of the deal have yet to be announced.
The new shareholders agreement signed between the three companies envisages greater cooperation between HCM and Telcon. It includes Hitachi sourcing components and machines from Telcon, introducing newer products of construction equipment in India, setting up a product development facility and making Telcon a part of HCM's global network.
Widely accepted as the foremost in excavator technology, HCM has over 70 subsidiaries and twenty four affiliates and has its own manufacturing operations in Japan, China, Indonesia, Netherlands, France and USA; and a global distribution network.
The new arrangement will help Telcon to significantly improve its product offerings to its customers and make it evolve as a global manufacturing and design hub.