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| Edited By: Josy Joseph |Source: DNA |Updated: Mar 30, 2018, 02:02 AM IST
Mahindra & Mahindra (M&M) has signed an agreement with BAE Systems, the global defence systems manufacturer, to create a land systems focused joint venture defence company that will be based in India.
The JV is hoping to corner a significant pie of India’s booming market for mine-protected vehicles and artillery guns.
The Foreign Investment Promotion Board had cleared the JV earlier this year.
Mahindra will hold 74% in the venture and BAE Systems will hold the remaining 26%, the maximum foreign direct investment allowed under the existing defence sector norms. The two companies will invest a total of $21.25 million over a three-year period.
Anand Mahindra, vice-chairman and managing director, M&M, said in a statement, “BAE Systems is the global number one land systems defence company and we couldn’t have a better partner for this venture. We look forward to making a major contribution both to the security and economy of India.”
Guy Griffiths, group managing director international, BAE Systems, said in a statement that the “Mahindra Defence Systems is a great choice to be our land systems partner in India. 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.”
The JV will be headquartered in New Delhi with manufacturing facility south of Faridabad, just outside the national capital. The statement said the company will initially have about 100 employees and manufacture the Axe high mobility vehicle as well as up-armoured and bulletproof Scorpios, Boleros, Rakshak, Rapid Intervention Vehicles and the Marksman light armoured vehicle.
The two sides are presently developing a mine-protected vehicle specifically designed for the Indian armed and paramilitary forces, it said. The JV would develop an artillery manufacturing centre. BAE Systems is a leading player in artillery and the Indian government has been looking at a possible acquisition of BAE’s light weight howitzer M777s.
