Electrolux to get 5% stake in Videocon Inds

Videocon group today signed an agreement with AB Electrolux to acquire the Swedish company's entire 91.85% stake in Electrolux Kelvinator.

As per the deal, AB Electrolux will get about 5% stake in Videocon Industries.

Videocon will take over the three manufacturing facilities of Electrolux Kelvinator at Shahjanpur (Rajasthan), Warora (Maharashtra) and Butibori (Maharashtra).

Under a separate licensing agreement with AB Electrolux, the Videocon group will distribute products under Electrolux and Kelvinator brands in India.

"As a result of this strategic partnership with the Videocon group, Electrolux will move from a subsidiary to a licensing model," an Electrolux release said.

The Swedish white goods major said it will continue its presence in India, and was expecting to source goods and services to the tune of $300 million per year by 2007.

"Electrolux's business with component suppliers, IT outsourcing companies and call centre operators will continue to grow in India. In addition, AB Electrolux is looking at developing India as global source for goods and services with a target of $300 million yearly by 2007," Peter Birch, Electrolux Asia-Pacific CEO and acting CEO of Electrolux Kelvinator, said.