Toshiba to acquire majority stake in Hyderabad’s Vijai Electricals for Rs1,277 cr
11 Sep 2013
Toshiba Corp, the Japanese multinational engineering and electronics conglomerate, yesterday said that it will acquire a majority stake in Hyderabad-based Vijai Electricals for Rs1,276.8 crore ($200 million).
"Toshiba Corporation and Vijai Electricals Ltd today announced that they have agreed to Toshiba's acquisition of the major part of Vijai's electricity transmission and distribution (T&D) business for approximately $200 million (around Rs 1,276.8 crore)," Toshiba said in a statement.
Founded in 1973, Vijai manufactures and sells electricity distribution transformers.
With high quality production capabilities, the company has top share in the Indian market and major footholds in both Europe and Africa.
Vijai further expanded its T&D business in 2006, when it entered the power transformer and switchgear businesses, and through the business activities it has manufactured and supplied the world's highest voltage class ultra-high voltage 1200 kV power transformer.
Tokyo-based Toshiba will set up a new company to absorb the acquired business, and also integrate its own state-of-the-art design and manufacturing technologies for T&D systems.
The new company will also enter other growing markets in India, including power electronics systems, such as high voltage direct current (HVDC) power transmission and static var compensators for high voltage networks (SVC), and railway power supply systems.
Toshiba said that it will position the new company as a core production base for expanding its T&D business in India and the global market, alongside its other bases in Japan, China, Brazil, Russia and Southeast Asia.
"The acquisition is necessary for our global T&D strategy, and Vijai's products and sales channel provide us with an ideal fit for our T&D business in India and beyond," said Takeshi Yokota, corporate vice president of Toshiba. "It will support us not only in the Indian market, where we aim to secure a 20 per cent market share within five years, but in reinforcing our position in the global market, by strengthening our worldwide network."
"I'm delighted to reach agreement with Toshiba, a global company. We are proud that our technology strengths and people capabilities will become part of Toshiba Group and will provide them a powerful platform for their business growth and market expansion," said, Dasari Jai Ramesh, Vijai's chairman.
Toshiba said that the T&D market size in India is expected to rise to over $4 billion by 2015.
