Videocon to buy Italian tubes plant of Thomson
France's Thomson said on Wednesday it would dispose of its Italian tubes manufacturing plant in Anagni to Indian consumer electronics maker Videocon, as it exits the low-margin production of television sets.
The deal, part of Thomson's transformation into a group focused on serving the media and entertainment industries, boosted Thomson's shares by over two percent.
The impact of the transaction would be in line with the one-time charge that was announced on October 21 to be taken largely against 2004 results, Thomson said in a statement.
Thomson, which is seeking partnerships for its display assets, had said it would take a one-time charge of 780 million euros ($1.02 billion) in second half of 2004 tied to depreciation of displays and components.
Videocon, meanwhile, was expanding internationally and would develop a European manufacturing base from the Anagni plant, Thomson said.
The Anagni plant, which employs 1,500 people and had annual sales of between 200 million and 250 million euros, was Thomson's sole tubes manufacturing plant in Italy, a Thomson spokeswoman said.
Thomson closed two US tubes plants last spring but retains tube manufacturing plants in Mexico, Poland and China.
Thomson is changing from a low-margin consumer electronics company into a high-margin provider of services like DVD replication, film post-production, professional broadcasting equipment and TV set-top boxes to media groups and film studios.
Thomson has already put its low-margin TV set production into a venture with China's TCL International Holdings Ltd. It recently signed an agreement with China's Konka in TV components and took an eight per cent stake in the firm.
It also announced last week it had formed a business alliance in digital television with Funai Electric Co Ltd, a Japanese TV and electronic goods manufacturer.