Bharat Forge Ltd, through its wholly owned subsidiary Bharat Forge Infrastructure Ventures Ltd (BFIVL), has signed a shareholders agreement with David Brown System India (Holdings) Ltd to form a joint venture company. The David Brown Group makes gear-boxes and transmissions products.
David Brown Bharat Forge Gear Systems India Ltd, the new company in which the partners will have equal stake, will serve the conventional power, wind, rail, cement, metals, rubber, mining, hydro, defence industries in India, addressing both demand for new build gearboxes as well as the aftermarket.
The company will begin operating from one of Bharat Forge's facilities initially. By the middle of 2012, a dedicated plant will be set up for gear box assembly and testing. The total investment involved will be £4 million, Mr Jim McColl, OBE, Chairman, David Brown, said.
“Our focus will be the heavy engineering industry in India and the areas we have identified will keep us busy,” he said, adding that the venture will start with refurbishing work.
Mr Baba Kalyani, Chairman and Managing Director, BFL, said that the new agreement was aligned with the Group's strategy to diversify into non-auto business sectors and also to enter into equipment manufacturing.
In addition to the manufacturing facility, the company will set up two service centres in Bangalore and Kolkata by the end of 2011 and two more in Delhi and Hyderabad are planned by the end of 2013. These service centres will be designed to world class standards, providing rapid aftermarket service and support to key industries.