Vedanta Plans To Boost Stake In Japanese Arm AvanStrate For Hi-Tech Manufacturing

Indian conglomerate Vedanta Ltd. plans to boost its stake in Japan-based indirect subsidiary AvanStrate Inc. as part of its strategy to diversify into hi-tech manufacturing.

Vedanta’s board on 10 May approved the acquisition of additional 46.57% stake in AvanStrate from Japanese company Hoya Corporation, the natural resources conglomerate said in a stock exchange announcement.

The stake acquisition will be done through the company’s wholly owned subsidiary Cairn India Holdings Ltd., which currently holds a 51.63% stake in AvanStrate.

The group will pay a maximum price of 12.2 billion Japanese yen ($78 million) for the acquisition of Hoya loans and its shareholding in AvanStrate.

The deal, which will be subject to all requisite approvals, is likely to conclude in the first quarter of FY25. Post-acquisition, Cairn India will hold a 98.2% stake in Avans Trate.

DEAL RATIONALE

AvanStrate, headquartered in Tokyo, is a leading manufacturer of glass substrates primarily used in the production of electronic devices such as televisions, laptops, smartphones, tablets, wearables and other electronic displays. The company has production facilities in Taiwan and Korea.

“The acquisition of AvanStrate aligns with company's vision of pivoting towards technology and diversifying into hi-tech manufacturing, while expanding its presence in high-growth markets,” Vedanta said.

The acquisition will help strengthen Vedanta’s capabilities to support the burgeoning hi-tech electronics manufacturing industry in India and capitalize on the growing demand for electronic devices in the country and globally.

The company said with more than 700 patents to its credit and a reputation for delivering cutting-edge products, AvanStrate has a strong supply chain network and partnerships with leading technology companies worldwide.

AvanStrate reported a turnover of 4.90 billion yen in FY23, compare with 7.01 billion yen a year earlier, according to the statement. Turnover stood at 4.11 billion yen in FY21, it said.

Note: $1 = 155.7440 Japanese yen

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