Osram India Ltd, a wholly owned subsidiary of Osram GmbH of Germany, has acquired the lamp business of ECE Industries Ltd at a cost of Rs 42.5 crore.
Following this acquisition, effective October 9, 1998, Osram India will add incandescent GLS bulbs and standard fluorescent tubes to its manufacturing portfolio.
"With more funds from the parent company and acquisition of the ECE facility, we hope to increase our share in the Indian lamp market from 4 per cent to 12 per cent by year 2000," Osram India managing director Raj K Sahgal said at a press conference in New Delhi yesterday. The lighting market in India is estimated at Rs 1,100 crore.
The investment in India by Osram GmbH, world's third-biggest lighting manufacturer after General Electric and Philips, since it came into existence four years ago has touched Rs 50 crore.
According to Osram's proposal, cleared by the Foreign Investment Promotion Board, the company will invest Rs 130 crore in India by 2000. "Competitive prices are essential to succeed in the market. We've taken to acquiring the manufacturing facilities of existing Indian players since this is the quickest and the cheapest option to mark our presence in India," said Sahgal.
The acquisition marks the transfer of ECE's sales organisation and a lamp factory in Sonepat to Osram.
At the production site, about 900 employees are involved in the production of incandescent GLS and fluorescent lamps.
Osram India, which made a profit for the first time in 1997-98 with a turnover of Rs 45 crore, also owns 83 percent equity in the Malanpur (Madhya Pradesh) plant of another Indian lighting player, Surya Roshni. Over the last four years, Osram India has set up 17 distribution centres across the country employing 55 people.
The FIPB approval permits Osram India to manufacture and trade in various new lighting categories, including metal halide and high-intensity discharge lamps, triphosphor and energy efficient fluorescent tubes, automotive halogen and discharge lamps, and photo-optic lamps.
Besides India, the company considers China as its other important growth region. It started operations in a new factory in Foshan (China) last year and got into a joint venture with a leading Indonesian firm as part of its thrust on the Asian region.
Osram GmbH employs over 33,000 people across the world and supplies to more than 140 countries. The company has 50 production facilities in 17 countries.
