India's Mahindra forms two JVs in defence, targets USD 1 bn in 10 yrs

New Delhi, Mar 30 (PTI) India's Mahindra & Mahindra company today announced formation of two separate joint ventures in the defence sector targeting a minimum turnover of USD 1 billion in the next ten years. The joint venture (JV) partners will invest Rupees 2.0 billion (nearly USD 40 million) in the two new entities. The first JV is between Mahindra & Mahindra and government of Israel-owned Rafael Advanced Defense Systems and another one is with the US-based Telephonics Corporation. The Indian partner will own 74 per cent stake in each, and the remaining 26 per cent will be with the respective international entities. "What we are seeing Mahindra & Mahindra do is to focus on where India needs to go in future," Mahindra & Mahindra Vice Chairman and Managing Director Anand Mahindra told reporters while announcing the new ventures. The JV with Rafael will focus on development and manufacturing of products such as Torpedo Defence Systems, Electronic Warfare Systems, Advanced Armour Solutions and Remotely Operated Weapon Stations for Futuristic Infantry Combat Vehicles (FICV). "Over a period of ten years, we are looking at a turnover of USD 500 million from this JV and if we are selected for the supply of FICV by the government of India then we expect that the turnover would immediately become one billion dollars," Mahindra said. Mahindra & Mahindra is one of the four companies which have received Expression of Interest (EOI) to supply around 2,000 units. An initial investment of Rs 1.0 billon (nearly USD 20 million) in the JV with Rafael will be made. The JV will also set up a facility in Pune in the western state of Maharashtra where mostly naval systems will be made, he said. Commenting on the JV with Telephonics Corporation of USA Mahindra said: "A similar amount of investment is being made by the partners and in the next ten years, we are expecting turnover of half a billion dollar." This JV has been set up primarily for Surveillance Radar Systems, Identification Friend or Foe (IFF) and Communication Systems. In addition, the JV also plans to provide systems for air traffic management services, homeland security and other emerging surveillance requirements. The joint venture will set up a facility by early next year in Bangalore in the southern state of Karnataka, Mahindra added. The group already has a joint venture with Europe's BAE Systems. PTI