The New York Stock Exchange-listed Nova said in a statement that it has signed a letter of intent with RIL for the joint venture, which is expected to be operational by the third quarter of 2008 after finalising the formal agreements.
"Initial steps necessary to manufacture components in India are underway. The first activity of the venture will be construction of buildings for Reliance Retail in India," Nova said.
Shares of Nova Chemicals rose 3.8 per cent to 26.17 dollars at the NYSE yesterday, while that of RIL were trading 1.3 per cent up at Rs 2,649 at the Bombay Stock Exchange here today.
Nova said that the proposed JV plans to leverage its "green building and construction technology to design, engineer and build a range of high-efficiency structures for the Indian sub-continent."
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The venture would enable Nova to work with RIL to build a large, profitable business based on its "proprietary performance styrenics building and construction systems," Nova said.
"India has a 60 billion dollars construction market that is growing at about 20 per cent per year. The potential for energy-efficient buildings in India is very exciting and these systems are an excellent fit for Reliance Retail's strategy," Nova President and Chief Operating Officer Chris Pappas, said in the statement.