FAG forms JV for taper roller bearings

By Our Staff Correspondent

MUMBAI, NOV. 24. FAG, world's leading bearings manufacturer, has announced the launch of a joint venture company, FAG Roller Bearings Private Limited.

The JV will focus on manufacturing taper roller bearings for the automotive industry. The agreement was signed by Dr. Martin Kunzmann, chairman and FAG Industrial Bearings AG, Germany, and member of the management board, FAG Kugelfischer George Schaefer AG, Germany, and Mr. D. Jagannath, managing director, FAG India, and Mr. Aman Chadha, Indian partners.

The initial equity investment of Rs. 5.50 crores is shared by FAG Germany (26 per cent) and FAG India (25 per cent) and the Chadha family (49 per cent). Mr. D. Jagannath, chairman, FAG Roller Bearings Pvt. Ltd., said, ``The Chakan plant with FAG technology is ideally suited for our expansion plans. With availability of taper roller bearings from Chakan plant, FAG will be in a position to offer single window purchases to Indian customers for their comprehensive bearing requirements. Each bearings produced at the plant will bear the stamp of FAG quality which customers world over trust".

The JV marks the entry of FAG in the highly competitive Rs. 400 crore taper roller bearings market. FAG India's existing product portfolio includes ball bearings, cylindrical roller bearings and spherical roller bearings manufactured at its Vadodara plant.

The plant of FAG Roller Bearings Pvt. Ltd. is strategically located at Chakan. The German plant of FAG group has been relocated and is being restructured to produce two million taper roller bearings annually and production ramp up is scheduled in the first quarter of 2002.

Dr. Martin Kunzmann, CEO of FAG Industrial Bearings, Germany, said, ``Taper roller bearings constitute nearly one third of domestic bearing market of over Rs. 1,200 crores in India. Presence in this market will enable FAG to offer comprehensive system solutions to Indian automotive customers".

FAG's sales for the nine month period ended September 2001 stood at Rs. 170.40 crores with a net profit of Rs. 13.10 crores. The company is targeting a turnover of Rs. 25 crores from the new company in the initial phase. In its existing scope of supply, FAG already enjoys confidence and preference of top automotive customers such as Ashok Leyland, Mahindras, Telco, Punjab Tractors, Maruti, and Escorts.

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Section  : Business
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