Sanyo Restructuring Has Zero Affect on BPL
Oct 4, 2005
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The BPL Group, which is embarking on a critical revamp through a joint venture with Sanyo, has said Sanyo's global restructuring plans will not impact the joint venture. Sanyo said that it was exiting the DVD player, DVD recorder and video recorder businesses, besides scaling down its home appliances divisions and pruning its workforce globally.

P V K Sundaram, director, BPL group, said, "Sanyo is committed to the joint venture with us and we do not see any impact of this global revamp on our pact. I am not sure how this revamp would affect Sanyo's other operations globally but I am sure that our JV should be rolling by the middle of this month."

Sanyo during August 2004 had signed a 50:50 joint venture with BPL for which it will pay U.S. $80 million to the BPL Group and, in turn, BPL would transfer its entire CTV assets (manufacturing units, sales and marketing network) to the joint venture. The Sanyo-BPL JV in India would be primarily focused on color televisions besides refrigerators, microwave ovens and air-conditioners.

Another senior official at BPL said, "Sanyo in India will be focused on high-end televisions and home appliances. The revamp at Sanyo deals with low-end products and there should be no reason for panic in the JV." As for the DVD, "it is a product which we will have to look at and we will take a decision soon. The initial focus, however, will be on CTVs."

Sanyo BPL had earlier stated that they will adopt a dual brand strategy wherein the Sanyo brand will be used for high-end products, while the BPL brand for mass market.

The official added that Sanyo and BPL share two decades of strong relationship and Sanyo was completely committed to the Indian market.

"They have committed vast amount of time, money and technology to this venture and they intend to drive this efficiently. They have had lots of patience in seeing this venture take off and I am sure they will not back out at this stage when the products are about to hit the shelves," he said.

According to Sanyo-BPL, over 9 to 12 months, a major portion of its brand building efforts would be to establish the Sanyo brand while not neglecting the BPL brand. (Business Standard)

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