Ammann plan joint venture in India
Swiss firm plans strategic partnership with Indian manufacturer Gujarat Apollo Industries Ltd
AMMANN and Gujarat Apollo Industries Ltd (GAIL), India’s market leader in the field of road construction equipment, have signed binding agreements relating to the acquisition of a 70% share in Apollo’s plant and machine business by the Swiss-based company.
Ammann Group say their decision to invest in Apollo’s core business of asphalt mixing plants, road pavers, bitumen sprayers and compaction machines underscores their global growth strategy.
The planned investment also heralds the entry of the Ammann Group into the Indian market for road-building equipment, for which market experts forecast strong growth thanks to the government’s political alignment and the ongoing development of the road network throughout the country.
The planned joint enterprise, Ammann Apollo India Private Ltd, will be responsible for the sale of the Ammann product range in the region, while the Ammann Group continues to operate on a global basis.
Subject to the approval of the shareholders of the market-listed GAIL enterprise, the planned shareholding of 70% will make Ammann the majority shareholder in Ammann Apollo India Private Ltd, with Gujarat Apollo Industries Ltd holding a share of 30%. The joint venture will be managed by the Apollo Group management team supplemented by personnel from Ammann.
Ammann’s planned investment in the joint venture equates to around €44 million. Conclusion of the agreement is expected by mid-April 2013, subject to the necessary approvals under corporate and regulatory law.
‘The investment is an important step for the Ammann Group and represents part of a well-designed strategy to expand into the growing Indian market,’ said Ammann’s newly appointed CEO Hans-Christian Schneider. ‘We see our partnership in the joint venture enterprise as an opportunity to invest in product developments and innovations for markets both in India and around the world.’
Anil Patel, founder of the Apollo Group, added: ‘We are pleased to be entering into this joint venture with the Ammann Group. Merging the two corporations will result in a very effective partnership with a significant increase in value for shareholders and improved prospects for growth.’