Nearly nine months after forging an understanding, Swedish defence firm Saab on Monday announced it has now formalised an investment of over Rs 200 crore in Indian defence company ‘Pipavav’.
The two companies had signed a memorandum of understanding (MoU) in August 2012 on Saab making a strategic investment of 250 million Swedish krona (over `200 crore) in the Gujarat-based Pipavav Offshore and Defence Engineering Limited.
“The investment of 250 million Swedish krona has now been made through direct shares issued to ‘Saab’ by ‘Pipavav’,” the two companies said in joint a statement. “After the investment, ‘Saab’ holds approximately 3.3 per cent of the capital and votes in the company. The investment will be financed from ‘Saab’s own readily available resources,” it said.
‘Pipavav’ is operating in the Naval domain in India and has plans to venture and grow in other areas of the defence sector as well.
When the MoU was signed in August 2012, ‘Saab’ and ‘Pipavav’ had also inked a Technical Partnership Agreement (TPA), a continuation of an ongoing co-operation between the companies covering details about the format for continued relationships and relevant projects.
“We are pleased to announce this partnership and our strategic investment in ‘Pipavav’. The investment offers a solid platform for growth on the Indian market and ‘Pipavav’ strengthens its competitive position through ‘Saab’s’ technology,” ‘Saab’ India Market Area Head Lars Olof Lindgren said.
“India is an important market for us and the investment will further reinforce Saab’s strong position on the global defence and security market,” he added.
‘Saab’ and ‘Pipavav’ had previously jointly formed the Combat System Engineering group, which analyses Naval combat system design and architecture. The companies are also exploring next generation combat management systems for the Navy and the Coast Guard.