Japan's Nissan Motor Co will invest US$195 million in two Thai joint ventures to increase its stakes from about 25 percent now to 75 percent, the company said in a statement yesterday.
The two joint ventures -- Siam Nissan Automobile Co, Nissan's manufacturer and distributor in Thailand, and Siam Motors & Nissan Co, the Japanese automaker's regional assembler -- serve as Nissan's export bases for the Southeast Asian market.
The companies are currently controlled by Siam Motors Group, a Thai family concern. However, the new investments would hand the Japan-based parent company a controlling interest in operations.
The Nissan statement did not say when the fresh investment would be made.
"Thailand offers a great opportunity for Nissan. This market offers both potential for future growth and an excellent base for us to expand our presence in the Southeast Asian region," Nissan President Carlos Ghosn said in the statement.
He said the move is an important step in the company's business expansion plans. As part of its medium-term business plan, Nissan aims to lift its global sales by 1 million vehicles from 2001 levels to 3.6 million by September, 2005.
The two ventures produce a combined 40,000 vehicles annually for sale in Thailand as well as for export to Indonesia and Singapore.
Nissan also operates production bases in the Philippines, Malaysia and Indonesia, but their output capacities are significantly smaller than those of the Thai ventures.
Nissan entered the Thai market in 1973. Its sales in Thailand last year totaled 43,557 vehicles, giving it a 8.2 percent market share, ranking fourth after Toyota Motor Corp, Isuzu Motors Ltd and Honda Motor Co. Most of Nissan's production is for domestic consumption.
Siam Motors was the only major auto company in the country that remained in the hands of a Thai family. Following the 1997 economic crisis, foreign automakers such as Honda, Toyota, BMW, Mitsubishi and Ford took control of distribution and manufacturing businesses from local companies.
The Nation newspaper reported last week that Nissan is likely to implement a capital increase after the takeover to expand the business and further dilute the stake of the Phornprapha family of Siam Motors Group.
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