27th October 2005 - Bosch and Brembo Establish Joint Venture to Manufacture Motorcycle Brakes for Indian market

The Indian Bosch subsidiary Kalyani Brakes Ltd. Pune, India, and the Italian company Brembo will establish a 50/50 joint-venture company for the application engineering, production and sales of two wheeler brakes. An agreement to this effect was signed October 17.

The joint-venture company will be headquartered in Pune, India. Kalyani Brakes, that pioneered introduction of hydraulic brakes for motorcycles in India, will integrate their existing two-wheeler brake production into the joint venture. Brembo will contribute licences and technology and will have the industrial leadership. The total investment of the two partners amounts to € 13 million.

The turnover for the first twelve months is forecasted at around € 20 million and is expected to double over the subsequent four years. Products are initially intended for the Indian market and the JV will explore export potential in the near future. The deal is subject to the final approval of the relevant Antitrust Authorities and Foreign Investment Promotion Board of India.

The Bosch Group recently increased its stake in Kalyani Brakes Ltd from 40% to 80% and took over the industrial leadership there. Kalyani Brakes is a leading Indian manufacturer of conventional brake systems and components with plants in Jalgaon, Pune, and Manesar. The company generated sales of € 63 million in the fiscal year 2004-05 and has approximately 1800 associates.

Apart from its holdings in Kalyani Brakes, Bosch is present in India with its subsidiaries Motor Industries Co. Ltd. (MICO), Robert Bosch India Ltd, and Bosch Rexroth India Ltd. The Bosch Group employs some 14,000 people in India, including Kalyani Brakes. In 2004, the Indian Bosch subsidiaries achieved sales of € 548 million.

Brembo is a recognised world leader in the development and production of braking systems and supplies the most prestigious brands, including the most renowned motorcycle worldwide.  Brembo has been licensing some design for motorcycle braking systems, without Brand, to Kalyani Brakes since 1999. The J.V. represents a significant development of Brembo presence into the Far East market for two-wheeler brakes.

The Indian market is growing fast, with some 6 million motorbikes sold over last 12 months, and the Pune plant will represent a base for the commercial expansion of Brembo products in the Asian region, where Brembo is already present with two production plants in China. Brembo motorcycle brake systems are the reference choice of almost all of the top teams in every world and national championship for motorcycle.

The Bosch Group is a leading global manufacturer of automotive and industrial technology, consumer goods, and building technology. In fiscal 2004, some 242 000 associates generated sales of 40 billion euros. Set up in Stuttgart in 1886 by Robert Bosch (1861-1942) as “Workshop for Precision Mechanics and Electrical Engineering,” the Bosch Group today comprises a manufacturing, sales, and after-sales service network of some 260 subsidiaries and more than 10 000 service centres in over 130 countries.

The special ownership structure of the Bosch Group guarantees its financial independence and entrepreneurial freedom. It makes it possible for the company to undertake significant up-front investments in the safeguarding of its future, as well as to do justice to its social responsibility in a manner reflective of the spirit and will of its founder. 92 % of the shares of Robert Bosch GmbH are held by the charitable foundation Robert Bosch Stiftung. The entrepreneurial ownership functions are carried out by Robert Bosch Industrietreuhand KG. Additional information can be accessed at www.bosch.com.

Brembo is the recognised leader in the design and manufacturing of high performance braking systems and components for a wide range of vehicles. It is an international group with production plants and sales offices in 11 different countries and markets its products in 70 countries worldwide, employing over 4000 associates. It has a fully integrated industrial process from design, development, foundries to assembly.

In Brembo innovation involves new technologies, materials, and forms. Aesthetic design is an added value to the performance quality of the products. The company’s efforts in technological and process development have been rewarded with excellent results. These factors, which have always been at the basis of the Brembo philosophy, have enabled the company to sustainably grow over time. Brembo ended 2004 with a 7% increase of revenues to € 678 million and a 17.2% rise in net income, with more than € 85 million in investments.  In a recent survey published by the European Agency of Standard Ethics Investments, Brembo was ranked among the best enterprises with respect to the OECD and U.N. standards for corporate governance and social responsibility.

Additional information can be accessed at www.brembo.com.

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