2024-12-15 23:15:01 :
New Delhi: Noida-based contract manufacturing company Dixon Technologies (India) Limited and Chinese smartphone maker Vivo’s India operations have entered into a binding term sheet for the proposed joint venture in which Dixon will hold 51% of shares, and the remaining shares will be held by Vivo.
The entities in the joint venture will be original equipment manufacturers (OEMs) like Dixon, which produce electronic devices including smartphones.
“The factory will undertake some of Vivo’s smartphone OEM orders in India and can also engage in OEM business for various electronic products of other brands,” the two companies said in a joint statement on Sunday.
Mint It was reported in July this year that Chinese smartphone makers such as Vivo, Oppo and Xiaomi were looking to bring Indian partners into their manufacturing operations and were discussing joint ventures in which Indian entities could hold a majority stake.
Expiry date of joint venture
The amount of investment, the scale of manufacturing and whether Dixon will take over Vivo’s existing or upcoming factories will all be determined in due course, two people familiar with the discussions said.
Vivo announced in 2019 that it would invest in $75 billion to increase manufacturing in India.
“We believe this association will enhance our manufacturing excellence and execution excellence, as well as Vivo’s leadership position in the Indian business ecosystem,” Atul B. Lall, vice chairman and managing director of Dixon, said in the statement. Adding that the partnership will strengthen Dixon’s capabilities. Gain a strong foothold in the Indian Android smartphone ecosystem.
He added: “In the time ahead, there is huge potential for us to further develop shared capabilities together to deliver sustainable growth to the proposed joint venture.”
Jerome Chen, CEO of Vivo India, said in the same statement: “We are pleased to sign a term sheet with Dixon, who has rich local management experience and excellent professional manufacturing capabilities.”
He added that this collaboration will effectively complement Vivo India’s current manufacturing operations.
The statement clarified that neither Dixon nor Vivo India will hold any shares in each other and both parties will agree on the optimal structure and related terms and conditions specified in the final agreement.
The transaction will be subject to the execution of such definitive agreements, the completion of customary conditions precedent and the receipt of applicable regulatory approvals, including the requirements of the Indian Exchange Control Act.
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