Videocon eyes Motorola handset business
Videocon, the Indian electronics group, has made an approach to Motorola (NYSE:MOT) to buy the handset business of the troubled US telecommunications group.
The move is the latest example of an Indian company seeking global expansion, coming less than a week after Indian conglomerate Tata (NYSE:TTM) sealed a high-profile agreement to buy the UK luxury car brands Jaguar and Land Rover from Ford (NYSE:F) for $2.3bn.
Venugopal Dhoot, chairman of Videocon, told the Financial Times that the company submitted an unsolicited "expression of interest" to Motorola on Monday.
He did not disclose details on how much Videocon, the leading Indian television company, might bid for the handset business.
But Motorola brushed aside Videocon's interest while declining to comment on what the US company characterised as "rumour".
Motorola last week announced plans to separate its struggling handset business from its profitable "broadband and mobility solutions" operations.
The decision to create two separate companies comes after months of agitation from disgruntled investors, led by corporate raider Carl Icahn.
Other handset makers including Nokia and SonyEricsson have dismissed the prospect of buying Motorola's business.
But Videocon views Motorola's handset unit as a "synergistic business", Mr Dhoot said.
Videocon recently received a licence to launch mobile phone services in India and also plans to roll out a chain of shops selling electronics.
An acquisition of Motorola's handset business would allow Videocon to diversify beyond its core business of manufacturing electronics, consumer durables and television picture tubes.
In 2005, Videocon bought the television-tube business of French group Thomson for $300m and the Indian appliance unit of Sweden's Electrolux for $74m.
A consortium consisting of Videocon and , part of US private equity firm Ripplewood Holdings, agreed in 2006 to pay Won700bn ($754m) for Daewoo Electronics, one of South Korea's biggest white goods and television makers.
The deal collapsed last May after the consortium asked for a 13 per cent discount and instalment payments over 10 years
source
The move is the latest example of an Indian company seeking global expansion, coming less than a week after Indian conglomerate Tata (NYSE:TTM) sealed a high-profile agreement to buy the UK luxury car brands Jaguar and Land Rover from Ford (NYSE:F) for $2.3bn.
Venugopal Dhoot, chairman of Videocon, told the Financial Times that the company submitted an unsolicited "expression of interest" to Motorola on Monday.
He did not disclose details on how much Videocon, the leading Indian television company, might bid for the handset business.
But Motorola brushed aside Videocon's interest while declining to comment on what the US company characterised as "rumour".
Motorola last week announced plans to separate its struggling handset business from its profitable "broadband and mobility solutions" operations.
The decision to create two separate companies comes after months of agitation from disgruntled investors, led by corporate raider Carl Icahn.
Other handset makers including Nokia and SonyEricsson have dismissed the prospect of buying Motorola's business.
But Videocon views Motorola's handset unit as a "synergistic business", Mr Dhoot said.
Videocon recently received a licence to launch mobile phone services in India and also plans to roll out a chain of shops selling electronics.
An acquisition of Motorola's handset business would allow Videocon to diversify beyond its core business of manufacturing electronics, consumer durables and television picture tubes.
In 2005, Videocon bought the television-tube business of French group Thomson for $300m and the Indian appliance unit of Sweden's Electrolux for $74m.
A consortium consisting of Videocon and , part of US private equity firm Ripplewood Holdings, agreed in 2006 to pay Won700bn ($754m) for Daewoo Electronics, one of South Korea's biggest white goods and television makers.
The deal collapsed last May after the consortium asked for a 13 per cent discount and instalment payments over 10 years
source
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