Rico Auto signs JV agreement with Continental AG of Germany

Rico Auto Industries Ltd has announced that the Company and Continental AG of Germany have signed an Agreement for establishing a new Joint Venture Company in India to manufacture Hydraulic Brake Systems (HBS). The new Joint Venture Company will have equity base of 50:50. The project is expected to start manufacturing in the second half of 2008.

Continental AG is a renowned International Automotive Component supplier, having an Automotive Systems Division in the field of safety products. Continental is one of the largest suppliers for conventional & electronic brake systems and automotive electronics globally. Continental AG"s turn over in the year 2006 was around 20 billion US Dollars. It has a work force of 87,000 out of which more than 30,000 employees work for Continental Automotive Systems Division, which has revenue of $ 8 billion.

The Company is amongst the leading players in the Indian Auto Components Industry. The Company supplies Aluminum and Ferrous Machined Components and Assemblies to Original Equipment Manufacturers (OEMs) across the globe.

The JV Company will produce hydraulic brake products and services consisting of calipers for front and rear axles, drum brakes, master cylinders, brake boosters and load sensing proportioning valves for vehicles of all classes. The planned annual production capacity is 1.0 million brake actuation units, 2.0 million brake calipers, 1.5 million drum brakes and 0.5 million load sensing proportioning valves.

This Joint Venture will be Continental Automotive System"s first manufacturing base in India for development & supply of Hydraulic Brake System (HBS).

The Company would be a preferred supplier of cast / machined components to the JV Company.

Source : Equity Bulls

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