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December 17, 1987

DEC TO BUILD MICROVAX II AT NEW 40%-OWNED INDIA VENTURE

By CBR Staff Writer

DEC plans to follow ICL into India with a 40%-owned local manufacturing affiliate that will initially build the MicroVAX II in India. It expects to get Indian government approval for the new Digital Equipment (India) Ltd shortly, and its plant will be in Bangalore, India’s new high-tech capital in the southern state of Karnataka. DEC will hold 40% of the new company, in partnership with long established local company Hinditron Computers Ltd, which will have 30%, and the balance of the equity will be floated on the Bombay Stock Exchange. Rather than accept a similar arrangement for its former IBM India subsidiary, IBM pulled out of the Indian market altogether. Other products will also be made at the plant, for export, but they will initially account for only 10% of output. DEC also has its eye on the army of trained programmers in India, and says it hopes to have software written there for export.Meantime ICL Ltd is helping its 40% affiliate International Computers Indian Manufacture Pte Ltd to raise about UKP2m to tide it over short-term cashflow problems. The Financial Times reports that ICIM has doubled turnover over the past four years to about UKP22m, and ICL now wants the firm, which has a plant making ICL ME29 and System 25 computers in Pune, to expand further, taking on manufacture of peripherals and subsassemblies. The loan ICL is arranging and underwriting is to meet short-term cash needs caused by recent lack of liquidity in the Bombay market. ICL is also planning a venture to develop software in India for export.

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