With the potential to become India’s first domestic iPhone manufacturer, Tata Group has been in negotiations with Taiwan’s largest electronics manufacturer Wistron Corporation to acquire a significant factory there.
In Brief
Tata Group and Wistron Corporation are nearing agreement on a significant acquisition of a manufacturing facility.
Just over 50 kilometres east of Bengaluru is where the 2.2 million square foot manufacturing facility is situated.
India may need the plant agreement if it wants to increase domestic manufacturing.
By India Today Web Desk: As it gets closer to finalising a significant transaction for the purchase of a facility, located in southern India, from Taiwanese manufacturing giant Wistron Corporation, Tata Group may soon provide the nation its first indigenous iPhone manufacturer.
According to a Bloomberg story based on two persons familiar with the situation, Tata Group has been in negotiations with Wistron Corp. for months and anticipates concluding the purchase by the end of March.
The sources mentioned in the article stated that although the two companies had considered possible alliances, discussions had since led to Tata Group acquiring a controlling stake in the joint venture.
According to the negotiations, Wistron will assist Tata Group in managing the primary production operation. It should be noted that neither Tata Group nor Wistron Corp. have made any public declarations on the likelihood of such a merger.
Apple often outsources the production and assembly of its iPhones to Taiwanese manufacturing behemoths like Wistron and Foxconn Technology Group. If Tata Group is successful in completing the transaction, it will considerably support India’s aspirations to develop domestic rivals that can counter China’s dominance in the electronics industry.
According to the Bloomberg article, the due diligence process would be finished by the Tata Group by March 31, 2023. This will allow its subsidiary, Tata Electronics, to formally acquire Wistron’s ownership of the factory. The factory will also be eligible for government subsidies starting on April 1, 2023, providing the takeover occurs before March.
According to one of the individuals cited in the Bloomberg article, assuming the business satisfies conditions to collect the anticipated incentives for the current financial year, the acquisition could value Wistron’s only iPhone manufacturing facility in India at more than $600 million.
Given that Apple is looking to lessen its reliance on China in the aftermath of pandemic-related supply chain concerns and a litany of regulations that have hurt device output, the plant purchase by Tata might be a huge boost to India.
If the purchase is approved, Tata Group would acquire the 2.2 million square foot manufacturing facility, which is little over 50 kilometres east of Bengaluru, as well as the 10,000 employees, including engineers, who work there. Tata Group will also take over all eight iPhone production lines.
