Mico To Hive Off Unit To Parent

Motor Industries Company Ltd (Mico) has decided to hive off its software development activity in India in favour of its parent company Robert Bosch GmbH of Germany, which plans to establish a 100 per cent fully owned subsidiary.

Mico has convened an extraordinary general meeting (EGM) on December 2 for passing a resolution for the disposal of its computer software development activity.

At the EGM, Mico also plans to pass another resolution for issuing redeemable non-convertible debentures of the aggregate value of Rs 50 crore shortly.

According to Mico, the software technology park licence which is presently in the name of Mico will be transferred to the proposed new company. The subsidiary will cater to software requirements of Robert Bosch entities worldwide, with plans to tap other customers are also being on the cards.

While Mico will continue to own the facility housing software development at Bangalore, the premises and infrastructural facilities will be licensed, and the computer hardware sold to the new company to be formed.

Mico's software activity in Bangalore, which became operational in the fourth quarter of 1996, was exporting software to Bosch. The company has exported computer software to Bosch group worldwide to the tune of Rs 14.4 crore, consisting of 1.24 per cent of its total turnover in India, during 1996 calendar year. Only last year, Mico had broken ground for a new location for its software centre in Bangalore.

The company's present software activity includes development of software for data processing, data communication, data preparation, data centre, user education and implementation.

The Indian subsidiary had at its AGM held on 17.6.1992 had approved the commencement of new business relating to development of computer software. The project, after some delay, had taken off since 1994. It is understood that present employees of the software centre including H Bertling, managing director, will continue to be part of the new company.

Mico's disposal of software activity in favour of its parent also signifies the leading auto ancillary company's plans to focus only on its core strength in future.