Tata Electronics, a Bharatiya company, is currently in discussions with Pegatron, a key contract manufacturer for Apple, to secure a majority stake in Pegatron’s factory located in Bharat. This move is part of Tata Electronics’ strategy to expand its presence in the electronics manufacturing sector within the country.
While the precise financial terms of the deal are still being negotiated, sources close to the matter have indicated that final details will be ironed out after the conclusion of the general election. It’s anticipated that the deal could be finalized by the months of July or August this year.
Despite attempts to reach out for comment, Pegatron has not responded to inquiries, while Tata Electronics has declined to provide any official statement on the matter. However, sources familiar with the ongoing discussions have confirmed Tata Electronics’ pursuit of the deal, emphasizing that it’s premature to delve into specifics at this stage.
Tata Electronics has been active in the acquisition arena, having previously bought the iPhone manufacturing unit of Wistron, a Taiwanese company, situated in Bangalore. This acquisition, valued at USD 125 million, took place in November of the previous year, further bolstering Tata Electronics’ position in the electronics manufacturing landscape.
Insiders suggest that the potential deal with Pegatron may be struck at a lower valuation. Pegatron’s Bharat facility primarily produces iPhone 12 and iPhone 13 models, although demand for these models has begun to wane. Nonetheless, with Apple’s plans to enhance its manufacturing operations in Bharat, both Pegatron and Tata’s Wistron factory are poised to benefit from increased production.
It’s worth noting that the latest iPhone models, namely iPhone 14 and iPhone 15, are currently being manufactured by Foxconn in Chennai. Apple has ambitious plans to ramp up its production capacity in Bharat significantly, aiming for a five-fold increase to USD 40 billion (approximately Rs 3.2 lakh crore) over the next 4-5 years. This strategic move aligns with Apple’s broader objectives of diversifying its manufacturing base and tapping into Bharat’s burgeoning market potential.
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