Tata Group in talks to acquire Wistron's iPhone manufacturing facility
An iPhone, made in India by Tata Group, could soon become a reality. The homegrown multinational conglomerate is in talks with Wistron Corp., one of Apple's top three vendors in India, to acquire its manufacturing facility in Karnataka. Tata has offered Rs. 4,000-5,000 crore for the factory. If the deal goes through, Tata would become the first Indian company to build iPhones.
Why does this story matter?
- Smartphones are among the few consumer products that Tata doesn't make. Its entry into the exclusive group that makes iPhones will be a boon for the company and country alike.
- Considering the recent struggles of China due to COVID restrictions and geopolitical tensions, this will provide India with a great opportunity to creep into electronics manufacturing and attract other global giants.
Wistron's manufacturing facility is located in Karnataka
Tata Group has begun discussions with Wistron to acquire its iPhone manufacturing facility located at Kolar in Karnataka. In September, Bloomberg reported that the two are in talks to set up a joint venture. It was touted that Tata would either buy equity in Wistron's India operations or build a new plant. It seems that the former is the chosen way forward.
Wistron may retain a small share
If the deal goes through, Tata will control the operation, but Wistron will retain a small share, according to The Economic Times. The arrangement will help Tata use Wistron's expertise in product development, supply chain, and assembly. This will also give the Indian company the much-needed push it's been craving in electronics and high-tech manufacturing.
The acquisition will help Tata Electronics Pvt Ltd
Tata Electronics Pvt. Ltd. (TEPL) was incorporated in 2020 as part of Tata Group's plans to widen its 'electronics horizon.' It was established to lead the group's ambitions to become a major mobile phone and components manufacturer. The company is already a components vendor for iPhones. However, the acquisition of Wistron's manufacturing facility will push TEPL to a different level.
Pact with Tata will help Wistron's struggling India operations
Wistron is set to benefit a lot from its deal with the Tata Group. A pact with a formidable local partner is just what the doctor prescribed for the company's struggling India operations. It can provide support, while Tata will manage the day-to-day business. The deal may also open Wistron an avenue into electronic vehicles, an attractive field for global tech giants.
