Joint Venture:
Joint Ventures are a special case of consolidation where two or more companies form a temporary partnership for a special purpose. Once the purpose is achieved, the joint venture is terminated, with all profits distributed to its members or losses recovered. Different joint ventures can take place between a. two firms in one industry, b. two firms across different industries, c. an Indian company and a foreign company in India, d. an Indian company and foreign company in the foreign country e. an Indian company and a foreign company in a third country.
For example:
! Birla Yamaha Ltd. is a joint venture of Birla and Yamaha Motor Co. of Japan.
! DCM and Daewoo Corporation of Korea established DCM Daewoo Motors Ltd.
! Hindustan Computers Ltd. and Hewlett – Packard of USA formed HCL-HP Ltd, a joint venture company.
! Tata Motors and Fiat has signed a pact (an agreement) for Joint Venture to manufacture passenger vehicles, engines etc.
! Tata Motors has signed another pact with a Brazil based company “Marcopolo” to manufacture buses for India and international markets.
! Recent news of JV (dated 28th Nov 2006) between Bharati Enterprises and Wal-Mart having equal stake of both (50 – 50% partnership)
43 Comments