Due to the economic slow down in Spain, the companies there are finding new ways to expand their businesses. The Spanish firms are looking for the options beyond Europe. Recently, Mondragon, a Spanish firm has invested Rs 34 crore in in Sherwal, 60-kms from Pune.
The company will set up an industrial complex in this region. Mondragon will open eight factories in the next five years mainly related to manufacturing sector, automobiles, hospitality and wind turbines.
Speaking to Business Standard on these developments, Jose Maria Aldecoa, president Mondragaon said, "Due to economic slowdown in Spain, we are planning to expand our business in the other countries like India, China, Brazil and Mexico, Thailand and Russia. As a result, the company has observed increase in sales and it is improving."
The first factory of Mondragon will be operational in July 2012 by the Danobat Group which is the machine tool division of Mondragaon has a JV with a company based in Indore named Indo tech for Band saws which is used for steel cutting.
Mondragon is expanding emerging markets including BRIC with about 63 per cent of group earnings now coming from international sales, it has 150 group companies, with over eight corporate offices and 18 plants outside Spain, including India. Aldecoa added, "India as a market holds great potential and Pune is ideal for the business expansion plan considering greater availability of land, skilled labour and its proximity to the ports in Mumbai. We are already supplying to automobile firms such as Tata Motors, Mahindra and General Motors in India. Mondragon will facilitate the setting up of these companies creating employment, raising standards and opening up new avenues for increased interaction between businesses in the Basque Country and India."
In August 2011, Mondragon has closed a deal with the Indian tubing manufacturer Taurus Flexibles Pvt. Ltd by which it will acquire a 50 per cent stake in the business located in Pune, India. They share the Rubber technology used for auto components industry. Maier, a group company has a JV with UM Group based in Gurgaon. They share the technology for plastic parts used for auto components industry.
