Sanyo disconnects joint venture with BPL

Sanyo Electric has announced that it will end its 50:50 joint venture for manufacturing cathode ray tube (CRT) televisions with Bangalore-based BPL.

The joint venture, which was set up four years ago, sold the Sanyo and BPL brands separately.

Sanyo made the decision as it wants to focus on plasma and LCD televisions, batteries, industrial cooling systems while not being saddled with conventional colour televisions, the technology of which is fast becoming obsolete and picture tubes are getting costlier.

"Globally, hardly any consumer electronic firm is into these conventional TV technologies and Sanyo is following that trend. The JV is likely to be dissolved," a senior Sanyo executive said.

 

Sanyo has already built direct presence in New Delhi to aggressively market its products and is engaging with retail majors to sell its cold-storage solutions.

After the dissolution of the JV, the BPL Group will continue to have presence in the healthcare equipment business, plastic moulds and batteries, besides its mobile handset business.

While there is still no official communication from the joint venture company, a Sanyo spokesperson reportedly confirmed the development to Nikkei English News in Tokyo.

The JV manufactured colour televisions from a factory in Bangalore, which has been shut already.

As a first move towards the separation, Sanyo has transferred the servicing responsibility to BPL for the CTVs the JV has sold since its inception. During the four years of its existence, the Sanyo-BPL JV, which is not listed on bourses, managed to acquire a marketshare of just little over 4 per cent in the 14-million colour television market in India and, reportedly, made losses.

Sources indicated that the JV tried to raise Rs 300 crore over a three-year period, but was unsuccessful in the effort. The JV employed about 600 people, most of whom have been compensated, an executive with JV said.