Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

Rakons to buy out Indian joint venture manufacturing partner

Rakon seeks to buy out Indian joint venture manufacturing partner for US$5.5 mln

By Paul McBeth

Feb. 27 (BusinessDesk) - Rakon is seeking to buy out its senior partner in an Indian joint venture for US$5.5 million, giving it control of what it says is a core part of the component maker's manufacturing strategy.

Auckland-based Rakon is in "advanced discussions" with Centum Electronics to buy its 51 percent stake in Centum Rakon India Private Ltd, a joint venture set up in 2008 pooling the firms' respective expertise in frequency control products. Rakon shifted manufacturing to India in 2012 in an effort to cut costs, although it booked a $3.2 million impairment charge on the Centum joint venture last year, valuing it at $3.7 million as at March 31, 2017.

"Both parties' management are continuing to pursue the proposed transaction and have signed a non-binding terms sheet in which Rakon would buy a consideration of US$5.5 million (staged over 18 months) for the 51 percent shareholding," managing director Brent Robinson said in a statement. "Management are continuing to work on finalising a number of matters including due diligence, approvals and the terms of final agreements."

Rakon turned to a first-half profit in the six months ended Sept. 30 noting growth in its key technology markets, which helped improve margins and reduce costs.

The company said the proposed deal to buy out its Indian partner is subject to "satisfactory conclusions of discussions" and various approvals, and has no deadline to be completed.

The shares last traded at 20 cents and have dropped 13 percent so far this year.

(BusinessDesk)

ends

© Scoop Media

 
 
 
Business Headlines | Sci-Tech Headlines

 

21, 22, 23 December: Air NZ Workers Vote To Strike

Last week union members voted overwhelmingly in favour of industrial action in response to the company’s low offer and requests for cuts to sick leave and overtime. More>>

ALSO:

24/7: National Geohazards Monitoring Centre Opens

For the first time, New Zealand will have 24-7 “eyes on” monitoring of the four perils: earthquake, tsunami, landslides and volcanic activity. More>>

ALSO:

EU Wine Exports: Yealands Fined For "Unprecedented Offending"

Yealands Estate Wines has pleaded guilty to “unprecedented offending” under the Wine Act 2003 and has copped a $400,000 fine. More>>

ALSO:

Discussion Paper: Govt To Act On Unfair Commercial Practices

“I’ve heard about traders who have used aggressive tactics to sell products to vulnerable consumers, and businesses that were powerless to stop suppliers varying the terms of their contract, including price.” More>>

ALSO:

'Considering Options' On Tip Top Ownership: Fonterra Drops Forecast Milk Price

Fonterra Co-operative Group Limited today revised its 2018/19 forecast Farmgate Milk Price range from $6.25-$6.50 per kgMS to $6.00-$6.30 per kgMS and shared an update on its first quarter business performance. More>>

ALSO: