New Delhi, Nov 30 (Inditop.com) Indian automobile major Mahindra & Mahindra Ltd. and global defence security and aerospace company BAE Systems have signed an agreement to create a military vehicles-focused joint venture based in India at an investment of $21.25 million, it was announced Monday.
The two companies will infuse the funds in three years, with Mahindra holding 74 percent of the equity and BAE 26 percent in accordance with the Indian government’s current defence sector foreign direct investment norms.
The JV, whose name is currently going through the official certification process, will be headquartered in New Delhi with manufacturing at a purpose-built facility south of Faridabad, just outside of Delhi.
Initially, there will be about 100 employees and existing projects include the Axe high mobility vehicle as well as armoured and bulletproof Scorpios and Boleros, the Rakshak rapid intervention vehicle and the Marksman light armoured vehicle, a Mahindra statement said.
“In anticipation of the new company, the two shareholders have been progressing a major new project to develop a mine protected vehicle specifically designed to meet the needs of the Indian armed and paramilitary forces,” the statement added.
The companies have worked in partnership to produce a prototype of this vehicle using the proven mine-defeating technologies of the BAE Systems’ 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 statement said.
It is also intended that the JV company will be involved in a number of future artillery programmes including the M777 lightweight howitzer and the FH77B 155mm howitzer.
“It is envisaged that the JV will become a centre of excellence for Indian artillery programmes,” the statement added.
According to Anand Mahindra, the vice chairman and managing director of the Mahindra Group, “BAE Systems is the global number one land systems defence company and we couldn’t have a better partner for this venture.
“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,” Mahindra added
Guy Griffiths, group managing director (International) of BAE Systems, said: “As winner of the 2009 Frost and Sullivan Award for customer value enhancement, which recognises excellence in customer service, customer retention and ultimately customer base expansion, 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. India recently became BAE Systems’ seventh home market; this new company is a central part of that strategy,” Griffiths added