Electrolux-Kelvinator has been merged with durables major Videocon Industries, and will be de-listed from the stock exchange. This follows the acquisition of the entire (91.85%) shareholding of the loss-making Indian subsidiary, from AB Electrolux (ABE) by Videocon in '05.
The Electrolux brand has been put under the charge of Aniruddh Dhoot, son of Venugopal Dhoot, and will be one of the brands in the Videocon group. “We have just completed the merger and will focus on taking the brand ahead in the Indian market.
We will spend over Rs 100 crore on advertisement and sales promotion for the brand. We will also receive R&D support from ABE to launch various high-end models of washing machines and refrigerators in the Indian market” said Aniruddh, CEO, EKL.
In addition to gaining control of EKL's three facilities in India, Videocon, under a separate licence agreement with ABE, started distributing marketing products under the Electrolux, Kelvinator and Allwyn brands in India and other SAARC countries.
Kelvinator will be handled by Kitchen Appliances, a Videocon subsidiary which also markets the Sansui brand of colour televisions.
The licences are being managed through a new branch office of ABE in India, which together with Videocon, promotes sales of Electrolux products. The branch office also manages the global sourcing needs of ABE in India.
AB Electrolux has been shifting its plants from high-cost locations to low-cost countries and they can well use India as a production baseABE, in a statement last year, said it is looking at developing India as a global source for goods and services with a sourcing target of $300 million a year by '07.
Videocon is eyeing an overall sales growth of 40% during the festive season and also considering the integration of its plants in Maharashtra.