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Mahindra and BAE Systems to invest US$ 21.25 m in Joint venture company Print E-mail
Written by Vijay   
Tuesday, 01 December 2009
New Delhi: Mahindra & Mahindra Ltd and BAE Systems have signed an agreement to set up a land systems focused, joint venture defence company, based in India. Both companies will invest US$ 21.25 million over a three year period. The company's equity split will be 74% Mahindra and 26% BAE Systems, in accordance with the current defence sector Foreign Direct Investment regulations of the GoI.

The joint venture company will be headquartered in New Delhi with manufacturing at a purpose-built facility located South of Faridabad, just outside of Delhi. It is expected to employ about 100 employees initially.

"We are already working together and the benefits for all parties, including the Indian defence and security forces, are clear.  We look forward to making a major contribution both to the security and economy of India," said Anand Mahindra, Vice Chairman and Managing Director, Mahindra Group.

The JV's existing projects include the Axe high mobility vehicle as well as up-armoured and bulletproof Scorpios, Boleros, Rakshak, Rapid Intervention Vehicles and the Marksman light armoured vehicle.

Mahindra & Mahindra and BAE Systems are working on a major new project to develop a mine protected vehicle specifically designed to meet the needs of the Indian armed and paramilitary forces. The companies have worked in partnership to produce a prototype vehicle using the proven mine defeating technologies of the BAE Systems South Africa RG series of vehicles and Mahindra's expert knowledge of Indian requirements and conditions. This development process has resulted in a brand new mine protected vehicle currently named MPVI (Mine Protected Vehicle India).  A prototype MPVI has been produced and will eventually be manufactured at the JV facility in Faridabad using indigenously produced materials.

The JV is envisaged to become a centre of excellence for Indian artillery programmes.

It is also intended that the JV company will be involved in a number of future artillery programmes including the M777 light weight howitzer and the FH77B 155mm howitzer.

"The skills and knowledge of the two companies are an excellent fit, and the values and vision which we share will allow this venture to prosper and innovate. India recently became BAE Systems’ seventh home market; this new company is a central part of that strategy," said Guy Griffiths, Group Managing Director International, BAE Systems.

The joint venture company, whose name is currently going through the official certification process, was approved by the Foreign Investment Promotion Board of the Government of India (GoI) earlier this year. The company's name and senior leadership are expected to be announced in due course.

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