Tata seals deal with Pegatron’s iPhone plant in Tamil Nadu, will hold 60% stake: Report
Tata Electronics is acquiring a majority stake in Pegatron's iPhone manufacturing plant in India, creating a joint venture. This strengthens Tata's position as an Apple supplier and marks Pegatron's latest move away from Apple amidst geopolitical tensions.
FollowTata Electronics has agreed to buy a majority stake in Taiwanese contract manufacturer Pegatron's only iPhone plant in India, forming a new joint venture that strengthens Tata's position as an Apple supplier, two sources informed media. According to the agreement that was made internally last week, Tata will control 60% of the joint venture and manage day-to-day operations, while Pegatron will control the remaining portion and offer technical assistance, according to the two people, who asked not to be identified since the specifics are still confidential.
The sources didn't go into detail about the deal's finances. In April, Reuters was the first to reveal that Pegatron, with Apple's support, was in advanced negotiations to sell its only iPhone facility in India to Tata. This was the Taiwanese company's most recent retraction of its relationship with Apple.
Given the geopolitical tensions between Beijing and Washington, Apple is trying more and more to diversify its supply chain outside of China. The Chennai Pegatron factory will support Tata's efforts to manufacture iPhones. Tata has been rapidly entering the iPhone production market, competing with Foxconn, the only other iPhone contract maker in India.
According to the first source, the deal's collapse was announced internally at the iPhone facility on Friday. According to the second source, the two businesses intend to apply for the Competition Commission of India's (CCI) clearance in the next few days.
In Karnataka, Tata already has an iPhone manufacturing factory that it acquired from Taiwan's Wistron last year. In addition, it is constructing a new facility in Hosur, Tamil Nadu, which also houses an iPhone component plant that was damaged in a September fire.
According to the first source, the deal's collapse was announced internally at the iPhone facility on Friday. According to the second source, the two businesses intend to apply for the Competition Commission of India's (CCI) clearance in the next few days.
In Karnataka, Tata already has an iPhone manufacturing factory that it acquired from Taiwan's Wistron last year. In addition, it is constructing a new facility in Hosur, Tamil Nadu, which also houses an iPhone component plant that was damaged in a September fire.
According to analysts, India will account for 20–25% of all iPhone shipments this year, up from 12–14% the previous year. With over 10,000 workers and a yearly production of 5 million iPhones, the Tata-Pegatron plant will be the company's third iPhone manufacturing in.
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