Vdo Arm Homes In On Phillips Car Audio Division

VDO India, part of German automotive group Mannesmann VDO AG, the global leader in instrumentation, is negotiating with Philips India to take over its car audio business.

According to VDO India chairman V M Bhat, consequent to the acquisition of the car audio and communication business by Mannesmann VDO AG from Philips Electronics, negotiations were in progress to buyout the car audio business from Philips India. Mannesmann VDO and Philips signed a final agreement to acquire Philips Car Systems (PCS) in January this year. The transaction was to be effected in two steps with Mannesmann VDO initially acquiring 100 per cent of the larger activities of PCS in Germany and the US, as well as 65 per cent of the remaining worldwide assets. The other 35 per cent of the company was to be taken over by Mannesmann VDO within a period of two years.

 

Early this year, Mannesmann VDO and the Mahindra Group singed an agreement to transfer the 40 per cent stake in Bangalore-based International Instruments (IIL) to VDO, which was held by the Mahindra Group. This eventually increased VDO's stake in IIL to 80 per cent. The remaining 20 per cent is held by the public. Mahindra divested its stake in IIL in an effort to divest itself of non core businesses. Mannesmann VDO has been associated with IIL for over four decades. By acquiring a majority in IIL, VDO plans to increase its presence in the local car manufacturing segment and market its range of automotive information and control and fuel systems, particularly to foreign car manufacturers in the country.

Some of the new products which VDO plans to introduce in the locally include completed vehicle modules such as cockpits, integrated tank systems, and electronic taxi meters. With the PCS acquisition , it plans to promote technology transfer to IIL for information management systems as well as for engine and fuel management systems.