Videocon and Thomson SA in circular deal for picture tube business
29 June 2005
New Delhi: The Videocon group has acquired the entire picture tube manufacturing operations of Thomson SA, for €240 million. With this deal, Videocon will own Thomson''s three manufacturing facilities in Poland, Mexico and China. 19,000,000 units of colour picture tubes along with 4,000,000 pieces colour picture tube glass, per annum.
The purchase agreement also allows Videocon to take over the R&D facilities at various places in Europe and China and access to a large resource of the patents and IPRS relating to technologies in colour picture tube segment.
Except one facility in China, which has the local Chinese government as a minority shareholder, all the business interests are owned by Thomson.
Videocon Group has drawn out an ambitious plan to improve these facilities both qualitatively as well as quantitatively by adding latest developments like slim tube, plasma, LCD and other flat panel display lines into business interests to be acquired from Thomson.
Videocon and Thomson executed the agreement in Delhi where finance minister P Chidambaram and Dominique Girard the French Ambassador. Videocon group, which comprises of four mainline listed companies has managed this acquisition through a complex deal with Thomson, which in the final analysis, will not involve any net outgo of funds.
The acquisition of Thomson''s manufacturing units has been made through an offshore entity of Videocon group in which other group companies like Videocon Communication, Videocon Appliances and Videocon International hold 19 per cent equity each, totalling 57 per cent. Videocon Industries has a 25-per cent interest in the oil exploration from the Ravva field, which yields a net cash flow of more than Rs 400 crore ($90 million)