Israel Aerospace Industries okays India joint venture

IAI and Tata will develop, manufacture, and support defense and aviation products.

The board of Israel Aerospace Industries Ltd. (IAI) (TASE: ARSP.B1) today approved a $50 million investment in Nova Integrated Systems Ltd., an Indian joint venture with Tata Industries Ltd. unit Tata Advanced Systems Ltd. IAI will own 26% of the joint venture and Tata Advanced Systems will own 74%.

Nova Integrated Systems will develop, manufacture, and provide technical support for defense and aviation products, including in missile, unmanned aerial vehicle (UAV), radar, electronic warfare, and homeland defense technologies.

IAI has an option to increase its stake in Nova Integrated Systems to 50%, subject to changes in Indian law. IAI will make an initial investment of $16 million in Nova Integrated Systems for the initial stake, and will invest an additional $14 million if it increases its stake to 50%.

IAI will also provide $20 million in financing and/or guarantees for Nova Integrated Systems' activity, provided that Tata Advanced Systems matches the amount.

The initial investment will finance the setting up of infrastructures, the purchase of land and equipment, recruitment and the training of personnel.

Nova Integrated Systems will have 4-12 directors, divided between IAI and Tata on the basis of their proportionate stakes in the company. Tata Advanced Systems will appoint the CEO and IAI will appoint the CFO.

Published by Globes [online], Israel business news - www.globes-online.com - on January 28, 2009

© Copyright of Globes Publisher Itonut (1983) Ltd. 2009

Twitter Facebook Linkedin RSS Newsletters גלובס Israel Business Conference 2018