L&T, Kobe to make mixers and extruders in Indian joint venture

ERJ staff report (DS)

Tokyo -- India's Larsen & Toubro Limited and Kobe Steel, Ltd. have formed a 51-49 joint venture, controlled by L&T, to make and sell rubber processing machinery for the tyre industry. The JV will specifically target European markets, as well as India and Russia.

Called L&T Kobelco Machinery Private Limited, the joint venture will make rubber mixers and twin screw rollerhead extruders used in manufacturing tyres. Plans call for construction of the plant to begin in February 2011 and production to begin in October 2011. Approximately 500 million rupees (900 million yen) will be invested in the facility.

Established in November 2010, the company is capitalised at 500 million rupees (900 million yen). L&T Kobelco is 51 percent owned by Larsen & Toubro and 49 percent by Kobe Steel. The Company will be managed by a Board of Directors comprising nominees from Kobe and L&T.

Local press reports said the JV facility would begin with mixers in sizes from 270l to 430l and extruders in diameters of 350mm and 45mm. This equipment would be marketed jointly by Kobe and L&T. More equipment will be added over time, said the company.

In 2003, Kobe Steel began providing Larsen & Toubro with technology to produce tyre curing presses, building a solid relationship over the years. A strategic partner of Kobe Steel in India, Larsen & Toubro is India's top manufacturer of tyre curing presses and has a strong sales network in India, Europe and the Middle East. The new joint venture, making full use of this sales network, plans to market its products in India, Europe, the Middle East, Africa, Russia and Eastern Europe - where to date Kobe Steel has had relatively low sales. Annual sales are anticipated to reach US$45 million in the 2014-2015 fiscal year.

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Press release from Larsen &Toubro via BSE

Press release from Kobe Steel via ERJ

L&T, Kobe Steel Ink JV For Tyre And Rubber Industry Equipment from Stock market review (India)