L & T, Sharp Electronics In Joint Venture

Engineering major Larsen & Toubro (L&T) yesterday formed a joint venture company with Sharp Electronics of Japan.

Sharp Business Systems (India), the new company, will market Sharp Electronics' international range of electronic office equipments. L&T will have a 26 per cent equity stake in the company, while Sharp will hold the balance.

L&T will contribute a platform in terms of market know-how, a distribution channel and a nation-wide reach through its network of offices, a company press release stated. L&T's existing electronics and electrical business division will continue to be part of the diversified company.

Through the joint venture company, Sharp will offer products like digital and analog copiers and fax machines. Besides, it will bring to the domestic market information technology products such as notebook computers, ink-jet printers, among others. L&T had introduced some of these products a year ago in the Indian market

Share price of L&T, which was down Rs 11.20 at Rs 172.75 yesterday, did not respond much to the joint venture reports.

The venture is part of the restructuring process started at L&T earlier this year, following the recommendations of the Boston Consulting Group. In January, the company had announced its plans to transform itself into a knowledge-based conglomerate.

While the main company would concentrate on engineering and construction, the other main business of cement could be hived off at a later stage. All other non-core businesses have been hived off into separate joint ventures with international market leaders. Sharp Corporation, a Fortune 500 company, is a world major in electronics. The company offers business solutions, consumer electronics and electronic components, liquid crystal displays, optometrics and semiconductors.