Videocon is on the verge of signing on the dotted line to acquire South Korean chaebol, Daewoo's consumer electronic business worldwide.
According to informed sources, all major glitches in the deal have been sorted out and the announcement is due shortly. Though the details of the deal could not be ascertained immediately, sources say it could be in the region of $500-600m.
When contacted, Videocon group chairman, VN Dhoot only reiterated that his company's bid was shortlisted and that the final decision is yet to come. But he did point out the importance of the company he has bid for. “Our core business has a clear synergy with Daewoo's electronic business,” he told ET.
Other bidders in the fray were Haier, LG and a couple of investment funds. Given Daewoo's various financial obligations, it wasn't surprising that the deal took close to six months to crystallise.
The acquisition would bring Daewoo's consumer electronics business including LCD TVs, plasma TVs and components into Videocon's fold strengthening its position in the industry. It would also have a strategic fit into the group as it would find a consuming partner for its recently acquired Thomson's picture tube business.
The Videocon group's brand portfolio in India now includes Videocon, Sansui, Akai, Kenstar, Hyundai, Toshiba, Electrolux and Kelvinator. Mr Dhoot had at the time of the bid, reportedly said that Videocon's internal accruals were sufficient to make a good proposal. That has worked, a source said.
“We want to figure amongst the top ten consumer electronics company and the initiative should be seen in that context,” Mr Dhoot said airing his vision for the company.
Last year, the Videocon group struck a series of deals in consumer electronics, home appliances and components space to emerge as a formidable player in the industry.