Auto electricals manufacturer Lucas-TVS will exiting its joint venture by selling its 29.9 per cent stake in the company to Japanese partner Koito Manufacturing, for around Rs 148.5 crore.
The joint venture, India Japan Lighting (IJL), was established in 1997 to manufacture and sell automotive lighting equipment. Since then, IJL has been supplying automotive lighting equipment mainly to Japanese automotive manufacturers in India.
"With the changes taking place in the lndian automotive industry, both the partners have agreed that Koito will assume 100 per cent ownership in IJL, towards the end of December 2019, and going forward, they will proceed to focus on their respective strategic initiatives," said a statement by Arvind Balaji, joint managing director of Lucas-TVS.
"In India, where the automotive market is expected to grow over the long-term, it would be necessary for the Koito Group and IJL to accelerate its decision-making," Koito Group said.
The company has decided to increase IJL’s capital to strengthen its financial base.
IJL has manufacturing operations in Chennai and Haryana's Bawal and is setting up a third plant at an investment of Rs 500 crore in Gujarat.
ln 2018-19, it reached a turnover of Rs 800 crore and is poised to serve the needs of automotive industry by offering cutting edge technology in lighting solutions for both two wheelers and four wheelers.
Its customer base includes Maruti-Suzuki, Tata Motors, Toyota-Kirloskar Motors, Honda, Yamaha, lsuzu, Daimler, Ashok Leyland, Nissan and Renault-Nissan.