Dixon Eyes Acquisition of Transsion Holdings’ Indian Unit

Dixon in Talks With Transsion
Preeti Bali / 11:27 am / April 4, 2024

Indian electronics contract manufacturer Dixon is engaged in discussions with the Indian arm of Chinese handset maker Transsion Holdings regarding a potential acquisition, according to a report by ET. Dixon is aiming to acquire a controlling stake in Transsion’s Indian operations, valued at approximately INR 700 crore.

Transsion Holdings, the company behind smartphone and feature phone brands like Techno, Infinix, and Itel, boasts a production capacity of 25-30 million units annually across its three manufacturing facilities in Noida. These three brands collectively hold a significant presence in the Indian mobile phone market, capturing 14% of the overall market share and 8% of the smartphone segment.

Dixon: A Well-Established Player in Indian Electronics Manufacturing

Dixon, on the other hand, possesses a robust manufacturing infrastructure with four plants in Noida, capable of producing 30 million smartphones and 50 million feature phones per year. The company already partners with various domestic and international brands like Xiaomi, Oppo, Vivo, Realme, Samsung, Motorola, and Jio for manufacturing their devices.

In September 2023, Dixon announced plans to invest over INR 400 crore in a new manufacturing facility near New Delhi. This 300,000 square foot facility will primarily focus on producing Xiaomi smartphones.

Acquisition Aligns with ‘Make in India’ Push

This development unfolds amidst the Indian government’s relentless efforts to promote its ‘Make in India’ initiative. The government, as per the media report, is unofficially encouraging a greater role for Indian companies in the country’s mobile phone industry, currently dominated by Chinese brands like Xiaomi and Oppo.

This push for domestic participation is partly fueled by government pressure on manufacturers to collaborate with local players and leverage the production-linked incentive (PLI) scheme for phone manufacturing. This scheme aims to generate an incremental production value of INR 3.35 trillion over the next six years.

In August 2023, the government received applications from 38 entities, including 25 domestic companies, for the PLI Scheme 2.0 for IT hardware. Among the domestic applicants were Dixon Technologies (India), VVDN Technologies, Optiemus Infracom, and Sahasra Electronic Solutions. Global PC manufacturers like Dell, Hewlett Packard, Foxconn (through a subsidiary), Asus, Acer, and Flex also expressed interest in the scheme.

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