Daihatsu doubles stake in Indonesian joint venture

JAKARTA (JP): Japan's Daihatsu Motor Co. Ltd. will soon double its stake in PT Astra Daihatsu Motor, a joint venture with Indonesia's largest auto producer PT Astra International, to 40 percent under an agreement signed here on Wednesday.

Under the deal, which also involves Nichimen Corporation doubling its stake, both Japanese companies will inject an additional Rp 450 billion (US$60 million) to strengthen the financial position of Astra Daihatsu.

"Daihatsu considers Indonesia, together with Malaysia, the most important foothold in the Southeast Asian region and will expand operations there," Daihatsu's president Iichi Singu said after the signing of the agreement.

Before the new deal, 75 percent of Astra Daihatsu was owned by Astra, 20 percent by Daihatsu and 5 percent by Nichimen Corp. Under the new joint venture agreement, Astra's share was reduced to 50 percent, Daihatsu's increased to 40 percent and Nichimen's to 10 percent.

"With this event today, we hope to lay down a more solid foundation and further enhance the brand image of Daihatsu in Indonesia," Iichi added.

Astra International's president Rini M.S. Sowandi noted that the agreement would provide a better synergy to enhance Astra Daihatsu's efficiency and productivity and leave the company in a stronger position in the ASEAN market.

Nichimen's president, Akira Watari, welcomed the new deal as a great opportunity to maximize its trading operations competence and provide support to enhance the development of Astra Daihatsu.

Part of the agreement stated that both Daihatsu and Astra will have an equal partnership in future expansion moves by Daitahsu to Myanmar, Vietnam, Thailand and the Philippines.

Astra Daihatsu, formed in 1992, produces 300 engines a month and other auto parts and assembles Daihatsu four-wheel drive vehicle. (vin)