Marketing @ Knowledge Zone


Re-inventing Videocon

- by Manasi Panigrahi *

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Strategic Alliances & Acquisition

  • They are famous for joint ventures & strategic alliances. In the past they went for JVs like: -

    • Akai-Videocon

    • Sansui-Videocon

    • Toshiba-Videocon

  • They are famous for Multi Pronged & multi branding strategies.

  • The Recent deals made were as follows

Companies Value of acquisition Share of pie for acquired company
Thompson SACPT Euro 240mn Thompson to invest $ 295 mn in Videocon industries & get a 15% stake in Videocon Industries plus two board seats
Electrolux AB's 91.85 (% in Electrolux Kelvinator) Cashless deal Electrolux to invest $ 94 mn in Videocon India & to get a 5% stake plus one seat in board

Reasons Behind this Deal

  • Global scale will give him an edge in low cost, low tech, High volume CPT market.

  • Prospecting Oil & gas in countries Western firms won't touch will prove profitable.

  • Sourcing contracts from partners such as AB Electrolux will boost manufacturing volume reducing cost.

Advantages It Has

  • Videocon has the largest distributed manufacturing base across India - 12 facilities. (As Compared to LG's two, Samsung ' has one, and Onida's two)

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* Contributed by -
Manasi Panigrahi,
Pursuing MBA, Batch of 2006,
ICFAI Business School, Hyderabad.